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LocalBitcoins Closes Shop After 10 Years Of Service

The year is just a month old, but the crypto industry already has a taste of the bitter-sweet happenings within this period. With the announcement that LocalBitcoins, one of the early crypto trading platforms, is shutting down operations after a decade, the crypto space was hit with yet another painful blow.

A Decade of Service

LocalBitcoins is one of the pioneer crypto trading platforms that paved the way for early crypto adopters to enter the sector. In a recent announcement, the firm disclosed that it would no longer offer its Bitcoin trading services to users on its platform.

As a result, the firm advised users to remove their funds from its custody and their LocalBitcoins wallet. Initially established as a platform with the name “Bring Bitcoin Everywhere” and operated to expand financial inclusion worldwide, with BTC at the forefront.

Meanwhile, the team has expressed delight at its previous achievements in the past decade. The company decided to shut down the operation due to the challenges of doing business amid the ongoing crypto winter.

Based on the firm’s timeline to close its operation, the platform announced a halt to new signups on February 9, with a suspension in trade activities and using the LocalBitcoins wallets, although only withdrawals are permitted.

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Furthermore, on February 17, users will be allowed to log in and withdraw their BTC tokens, as bot trading and wallet services will not be available now. LocalBitcoins also stated that it had specified a 12-month period to allow users to withdraw their assets.

The latest development is a shocking event in the fortunes of the once-leading peer-to-peer (P2P) Bitcoin exchange. Its CDEO, Sebastian Sonntag, is reported to have revealed in 2021 that LocalBitcoins is looking to onboard over 135,000 new users monthly, with a projected registration of 4,000 to 5,000 wallet holders per day.

Fear And Doubts Over FTX’s Collapse

The exchange threw the entire crypto ecosystem into a gloomy period, with rising fears over the safety of customer funds in several major exchanges. Even the world’s leading crypto exchange Binance was shaken as users withdrew close to $2 billion worth of crypto assets from the firm in a single day as a reaction to the FTX collapse in November 2022.

Per the blockchain analytic firm Nansen, Binance users have removed over $8.7 billion from the platform in just a week. As the capital outflow continues, Binance CEO Changpeng Zhao had to respond by assuring users that the exchange has enough liquidity to cushion any impacts.

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The CEO remains confident that the exchange had what it took to safeguard customers’ and investors’ funds in its custody. As the crypto market continues to find its feet after such a massive setback, crypto exchanges are aware of what the industry will face if another FTX-like scenario happens.


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Bradley Nelson

Bradley Nelson is a US based cryptocurrency news writer for Tokenhell, he helps readers stay up to date with the latest trends and news from the blockchain and crypto world. Bradley has been a crypto enthusiast since 2018.

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