localbitcoins.com Buying Selling/Trading Exchange with Easypaisa Jazzcash Credit/Debit Card 2018
Significant Trade Volume Triggers Localbitcoins KYC Requirement
According to a recent thread on Reddit, Localbitcoins traders allegedly have to verify their identity if they are trading “significant” volume using the peer-to-peer platform.
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Localbitcoins ‘Error’ Involves Know-Your-Customer Verification
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that stated a Localbitcoins user’s trade volume was “significant” this past year, and the trader had to verify their identity in order to keep trading. The picture reads:
Error! Your trade volume has been significant in the last twelve months. Please verify your identity to continue trading.
does use a verification process but it’s never really been enforced, although some believe more traders will trade with you if you are verified. Much like the rest of the exchanges out there that do require immediate verification, Localbitcoins uses an ID service called ‘Netverify, Localbitcoins App Download , the user uploads a picture of both sides of their license or state ID and in a few minutes, the platform reveals if the identification is a legitimate or not.
The post on Reddit submitted on Tuesday is not the first time this news has spread among the cryptocurrency campfire. Back in January of 2018, there are posts on
that show another trader required to use their ID to trade on Localbitcoins. Immediately the discussion among bitcoiners turned to decentralized exchanges like Bisq, Hodl Hodl, and Barterdex. The Reddit user /u/yellowcuda who created the post has an account that is three years old, and further down the thread he
To clarify: me and many of my peers who use Localbitcoins started getting this notification upon signing in, requiring them to submit their ID. Without it, you cannot continue trading. This is it, folks — The long-lasting bastion of freedom fell.
Many of the decentralized exchanges (DEX) today do have operational platforms, but liquidity on exchanges like Hodl Hodl, Bisq, Openledger, Bartdex, Idex, and Waves is not that much compared to centralized exchanges (CEX). Further, some of the platforms are in the very early stages and don’t have the functionality and features found on large VC-funded trading platforms.
Lastly, a few decentralized exchanges do offer fiat pairs, but a lot of them don’t have access to fiat and most platforms offer cryptocurrency-to-cryptocurrency swaps. It’s safe to say that much of the issues tethered to Localbitcoins users being arrested and the company itself requiring verification is likely because people are swapping for fiat and nation-states like the U.S. don’t appreciate that kind of business without permission. There have been no statements made by the owners of Localbitcoins yet about this issue and there are no official updates on the main page.
What do you think about Localbitcoins requiring users who trade “significant” volume to verify themselves? Let us know in the comments below.
Images via Shutterstock, Localbitcoins, and Twitter.
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Jamie Redman is a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open source code, and decentralized applications. Redman has written thousands of articles for news.Bitcoin.com about the disruptive protocols emerging today.
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