End of Bitcoin trading service
LocalBitcoins, a P2P exchange for crypto assets (virtual currency) Bitcoin (BTC), announced on the 9th that it will stop providing services.
It has been operating for more than 10 years with a mission to provide Bitcoin everywhere and promote financial inclusion, but it has not been able to overcome the winter of cryptocurrencies, explaining the reason for the termination of the service. .
Acceptance of new registration ends on the 9th. The trading service will end on the 16th. After that, only withdrawals will be accepted, and the withdrawal period will be 12 months.
LocalBitcoins is an exchange founded in 2012. It has been operating under regulatory approval in Finland, where it is based.
The feature of an exchange is that people from various countries can trade directly with each other. In addition to trading services, we have provided a wallet service that allows you to send and receive bitcoins. LocalBitcoins were used in a wide range of countries including Turkey, Venezuela, Argentina, Russia and China.
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Below is the data provided by “Coin Dance”, charting weekly trading volume on LocalBitcoins. Trading volume for the week of February 4 was over ¥850 million ($6.5 million), a downward trend since the 2017 cryptocurrency bubble. Trading volume has not returned even when Bitcoin hits new highs in 2021.
Pointed out by US regulators
Last month, the US Treasury Department’s Financial Crimes Enforcement Network (FinCEN) linked LocalBitcoins to cryptocurrency exchange Bitzlato. U.S. regulators indicted Bitzlato’s Russian-born founder last month on suspicion of operating an illicit fund transfer business and failing to comply with anti-money laundering requirements.
What is FinCEN?
Abbreviation for “Financial Crimes Enforcement Network”. Its mission is to collect and analyze financial information, prevent fraudulent use of the financial system and money laundering, and promote national security.
connection: US authorities crack down on virtual currency exchanges with international cooperation
Bitzlato advertises that it rarely asks users for ID, saying, “No selfie or passport required.” Bitzlato was said to have become a hotbed for criminal funds due to insufficient KYC checks.
FinCEN pointed out that from May 2018 to September 2022, LocalBitcoins was included in one of the entities that sent and received a large amount of money from Bitzlato. On the other hand, LocalBitcoins’ chief marketing officer denied to blockchain media Cointelegraph that it had cooperated with Bitzlato.
The sudden termination of the service was immediately after FinCEN pointed out, but the current market conditions are the reason for the termination of the service.