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Bitcoin exchange LocalBitcoins has announced its closure after serving customers for over a decade, citing the ongoing bear market.
recently post The exchange said on its website that it will close in the coming weeks due to difficult market conditions. The platform said it reached this decision after efforts to overcome the current crypto winter have been fruitless. said:
“Therefore, we would like to share that despite our ongoing efforts to overcome the challenges of the extremely cold cryptocurrency winter, we have unfortunately come to the conclusion that LocalBitcoins will no longer be able to offer bitcoin trading services. It is sad that
LocalBitcoins has detailed that it will stop signing up starting Thursday, February 9th and stop trading by February 16th. The exchange advised customers to withdraw their funds as soon as possible. A client can withdraw funds from his wallet for 12 months.
Founded in 2012, LocalBitcoins is one of the earliest and most popular peer-to-peer Bitcoin trading platforms. In the early days of Bitcoin, exchanges became an important marketplace to facilitate liquidity. It has also created a profitable arbitrage market as users can sell BTC at spreads higher than the spot price and buy assets cheaper on centralized exchanges.
According to the LocalBitcoins website, there are around 8 million customers in over 190 countries. Since February 2021, the exchange’s trading volume has continued to decline, averaging over $40 million per week. At its peak in 2017, LocalBitcoins processed about $100 million worth of transactions every week, but that number has dropped to $5.5 million over the past four months.
Notably, the move comes after LocalBitcoins was named by the U.S. Treasury last month as one of the companies trading with Bizlato, a cryptocurrency exchange accused of money laundering. As reported, Binance and TheFiniko have also been identified as counterparties to Bitzlato, which is currently facing money laundering charges in the United States.
Last month, U.S. authorities arrested Anatoly Legkodymov, the Russian founder of Hong Kong-registered cryptocurrency exchange Bitzlato, for allegedly processing $700 million in illicit funds. His charges also include operating the exchange as an unregistered money transfer business that facilitates the movement of illegal funds.
LocalBitcoins faces regulatory scrutiny in other parts of the world as well. Back in 2020, the platform had to comply with strict European Union anti-money laundering regulations that put pressure on businesses in Europe. In 2015, LocalBitcoins had to cease operations in New York State after failing to obtain a BitLicense from the state.