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What is LocalCoinSwap?
LocalCoinSwap is a P2P-crypto platform registered in Saint Kitts and Nevis. It launched back in 2017.
At LocalCoinSwap, people from different countries can post ads where they state exchange rate and payment methods for buying or selling any of the cryptocurrencies supported by the platform. You reply to these ads and agree to transact with the person you have replied to. The seller puts the relevant crypto in an escrow account, and when the parties have transacted and the seller has confirmed payment to LocalCoinSwap, then LocalCoinSwap releases the crypto from the escrow to the buyer.
In many ways, LocalCoinSwap is like an online store or an Ebay for cryptocurrencies. Investors at the exchange post different “ads”, where they offer a price quote for a specific cryptocurrency. This ad can be for both buying or selling or either one of those actions. If you as another buyer/seller thinks the offer is good, you can just take it.
The platform’s mission is to allow users to exchange directly, with no middleman.
LocalCoinSwap Trading View
Every trading platform has a trading view. The trading view is the part of the exchange’s website where you can see the price chart of a certain cryptocurrency and what its current price is. There are normally also buy and sell boxes, where you can place orders with respect to the relevant crypto, and, at most platforms, you will also be able to see the order history (i.e., previous transactions involving the relevant crypto).
LocalCoinSwap, however, is as mentioned above not really an exchange per se. It is more like an Ebay for cryptos. At this place, you can scan through a number of different sale/purchase ads that have been posted by other users of the platform. You can sort by payment method, price, popularity, coin etc, to find a seller/buyer that you want to transact with. The below is a picture of the list where you can find different offers at LocalCoinSwap:
It is up to you – and only you – to decide if the above interface is suitable to you. Finally, there are usually many different ways in which you can change the settings to tailor the trading view after your very own preferences.
LocalCoinSwap Trading fees
Considering the above business model, the distinction between parties on the exchange is not taker and maker, it’s rather more like person advertising and person responding to advertisement. The person responding to an existing offer is not charged anything (0.00%). The person who have created the offer needs to pay 1.00% in trading fees.
If comparing 1.00% to average trading fees for centralized exchanges, it is very high. However, there are great dissimilarities between LocalCoinSwap and centralized exchanges somewhat explaining the higher fee.
We recommend investors using LocalCoinSwap to consider themselves whether this fee is to their liking or not.
LocalCoinSwap Withdrawal fees
The final fee to consider is the withdrawal fee. LocalCoinSwap charges 0.00025 BTC per BTC-withdrawal for the standard BTC wallet, but the fee is customizable for its non-custodial wallet (the exchange supports both non-custodial and standard custodial trading/wallets for BTC).
This fee is way below the global industry average, as the industry average according to the only empirical study performed on the subject that we know of, this one, is 0.00053 BTC per BTC-withdrawal.
Deposit Methods and US-investors
Why do so many exchanges not allow US citizens to open accounts with them? The answer has only three letters. S, E and C (the Securities Exchange Commission). The reason the SEC is so scary is because the US does not allow foreign companies to solicit US investors, unless those foreign companies are also registered in the US (with the SEC). If foreign companies solicit US investors anyway, the SEC can sue them. There are many examples of when the SEC has sued crypto exchanges, one of which being when they sued EtherDelta for operating an unregistered exchange. Another example was when they sued Bitfinex and claimed that the stablecoin Tether (USDT) was misleading investors. It is very likely that more cases will follow.
LocalCoinSwap actually does accept US-investors on its platform. We do however always recommend US-investors to perform their own analysis of whether or not they can trade somewhere, in particular considering that different states can have different rules on where their residents can trade.
This platform is an entry-level exchange, meaning that it is one alternative for people who would like to enter the cryptocurrency market and does not have any cryptocurrency assets to begin with. There are more than 250 different payment methods available to deposit with here.
Great work, LocalCoinSwap!