One of the major features of Bitcoin is that it’s peer-to-peer (P2P), meaning, you can send and receive Bitcoin with your peers around the world without having to go through a middleman like a financial institution.
However, over the years as Bitcoin has become more popular, we’ve seen less P2P-style transactions as more centralized services such as exchanges and payment providers come on to the scene. This is because these services make buying and selling Bitcoin easy, but with convenience comes a cost.
Not only do we mean a financial cost because you pay premium fees for these services, but you also lose privacy and in many cases anonymity. Mainly due to Know-Your-Customer (KYC) rules with exchanges and them requiring personal and sensitive information about you, such as your name, address, phone number and other identification. This has put a real burden on the space for those that want to trade without this sort of interference.
Fortunately, over the years there have been different services that offer local trading but many of them haven’t taken off so aren’t well known and have no liquidity or have succumbed to government regulations making them not local nor P2P; they aren’t P2P if they let the government intervene in transactions and stopping trades due to aggressive over-reaching rules and regulations.
Local Bitcoin (Local.Bitcoin.com) aims to break the mold and bring back P2P transactions to Bitcoin. Using Bitcoin Cash as it’s base currency, users can now buy and sell Bitcoin Cash with each other with no middleman. In addition, because of the way Local Bitcoin is setup using Blind Escrow, Local Bitcoin never touches any funds whatsoever – which means that there is no KYC at all on the platform. Users can trade with each other with confidence, privately and anonymously.
Getting started on Local Bitcoin is extremely easy. The first step if you aren't registered is to sign up for the platform. All that is needed is an email address. Once registered make sure to verify your email address and setup two factor authentication for security reasons. You can do this in the My Account section.
If you want to buy Bitcoin Cash the next step is to visit the Offers page which will have filters at the top. Make sure to change your filter to “I want to Buy BCH.” You can then filter further on Payment Methods to a type that you prefer, for example you can change it to “Cash deposit” where you deposit cash to the sellers bank account directly so they can sell you Bitcoin Cash. You can also filter by location which will help narrow down the search to sellers in your area.
Buying isn’t as hard as it seems, but as a first-time buyer this task may seem daunting. Don’t fret, it’s not so bad in retrospect. The first thing you will want to do is click on the offer you're interested in. You will be presented with the offer page to open the trade with the amount you want to buy. The page will also provide details about the seller. Make sure to review it including their feedback and reputation. You can click on the seller’s name to view their profile to view the details there too. The page also includes the Terms of the trade so you understand how the seller expects the trade to go, for example it may say something like “deposit cash to Bank, account details will be provided over chat.”
Once the trade is opened, it will create the Trade page with the seller. It includes a fully encrypted chat session so you can talk to the seller and they can talk to you. A best practice will be to send them a quick message just saying you are ready to trade with them and provide some details such as “I’m ready to trade, please provide your bank deposit information.” If you aren't sure, just ask the seller what is the first step to start the trade.
On the seller’s end they will then have to put their BCH in escrow where it’s held in a Blind Escrow. Once that is done and while communicating with the seller via the chat, you will want to send the payment to them. When you are done making the payment, make sure to click the “Mark As Paid” button on the offer. After they have received the payment and have confirmed it on their end, they will release the funds sitting in escrow to you.
Once the escrow is released, the funds will be sent to you in your Wallet on the Local Bitcoin page and you are done – the transaction is complete! Make sure to give the seller a thumbs up or down depending on how smoothly the transaction went. The seller can also provide the same feedback to you as the buyer. Doing this helps to build reputation on the site for all parties.
Have more questions? Make sure to read all the Local Bitcoin FAQs which covers many areas from security, to usage, escrow and disputes.