Top 5 Alternatives to LocalBitcoins
Table of Contents
Bitcoinist compiled a list of alternative platforms for p2p Bitcoin, altcoin and fiat trading that ensure safety, privacy, and freedom — something that’s often missing in centralized exchanges that typically hold the keys to your bitcoin.
P2P TRADING & LOCALBITCOINS
LocalBitcoins is a peer-to-peer exchange that offers trading services all around the world. While the platform itself is not decentralized, it allows users to exchange Bitcoin for national currencies directly between themselves.
The exchange allows out-of-band payments for fiat currencies, including wire transfers, cash deposits, PayPal, cash on hand, and others. The p2p model brings with it many advantages to the average user, the main one being privacy.
LocalBitcoins also allows users to circumvent restrictions applied in certain countries where exchanges may not exist or be heavily regulated. A prime example of this would be the latest developments in China, during which the People’s Bank of China mandated that cryptocurrency withdrawals be paused on exchanges until AML policies were updated and approved, causing many traders to move to P2P platforms like LocalBitcoins.
However, LocalBitcoins is not the only peer-to-peer exchange out there. Others are exploring the realm of decentralized trading, a highly required feature for a global p2p cryptocurrency that has already witnessed the devastating issues brought by centralized currency exchange too many times.
Here’s a list of alternative platforms for p2p trading. We have left out blockchain-based exchanges like OpenLedger, CounterParty, Etherdelta, and others due to the lack of fiat currency support.
Bitsquare is a fully decentralized Bitcoin, altcoin, and fiat exchange. We say it is fully decentralized because even the platform itself is not hosted on a central server. Instead, it is hosted by all the nodes that run it (much like Bitcoin) and is, as so, resistant to censorship and hacks. The platform also provides users with a higher degree of privacy by using Tor hidden services and encrypting all the private data sent over the wire.
Bitsquare supports multiple national currency payments and employs a decentralized multisig escrow mechanism in which the buyer, seller, and a moderator hold the private keys to release the funds. The moderator can step in and solve disputes for a fee that is charged to the person that misbehaves during the trade or to both users.
Bitsquare has low liquidity but it has been increasing with time. It is the only fully decentralized exchange that supports altcoins and fiat currencies without the need for proxy tokens.
Click here to visit Bitsquare.
BitKan is an Android and iOS application that provides P2P bitcoin trading services with broker matchmaking. Last year, Bitkan added an OTC market which displays traders in the user’s area and their buy and sell quotes. Users can choose the person they want to trade with, contact them through the app, and arrange a trade.
BitKan employs a traditional escrow method to ensure user safety and is considered by many to be a more convenient service than LocalBitcoins, particularly in China — its main area of focus at the moment — where trading volume has soared twelvefold since last month.
Users can trade small amounts in five minutes, although large amounts (more than 5 BTC per day) will require the user to comply with KYC and AML guidelines, which means submitting personal information.
Click here to visit BitKan.
Paxful is a P2P Bitcoin exchange that works the same ways as LocalBitcoins. Users can create or take an order and trade Bitcoin for fiat currencies via out-of-band payment mechanisms. The bits are handled by a centralized escrow mechanism controlled by the exchange’s moderators.
Paxful’s global trading volume dwarfs Bitsquare at the moment, hitting $4 million USD. The trend has been on a constant upward trajectory, which should provide an increasing number of options for users moving forward.
Click here to visit Paxful.
Still in development, Spain-based Coinffeine aims to be an open-source, P2P bitcoin exchange platform that will run on a similar model as Bitsquare, where nodes host the exchange platform itself, making it impervious to geopolitical restrictions or server downtime.
Coinffeine compares it to a “Bittorrent” for your bitcoins. However, Coinffeine is currently in a technical preview stage, meaning that the current Coinffeine distribution is working with play money in order to prevent accidental losses.
The first release will focus on bitcoin to fiat exchange only, although altcoins will be explored in the future. There is currently no official launch date for Coinffeine.
The OpenBitcoins platform is going to be launched in two days. Although there isn’t a lot of info available, the exchange promises to offer peer-to-peer trading through a centralized escrow system with absolutely no trading fees. Stay tuned for the platform launch.
Click here to visit OpenBitcoins.
Images courtesy of CryptoCompare, Google, Paxful,