LocalBitcoins customers have 12 months to withdraw their cryptocurrencies from the LocalBitcoins wallet, but it is recommended to do so immediately.
Finnish peer-to-peer (P2P) cryptocurrency platform LocalBitcoins is shutting down after serving customers for more than 10 years.
LocalBitcoins announced the official termination of service on February 9, citing the harsh market conditions of the ongoing cryptocurrency winter.
“Despite our efforts to overcome the challenges and bring our trading volume and declining market share back to growth, we regret to conclude that LocalBitcoins can no longer provide its Bitcoin trading services”, Nikolaus Kangas CEO of LocalBitcoins told Cointelegraph. At the time of announcement, the LocalBitcoins team has 50 employees.
LocalBitcoins urges all customers to withdraw their crypto assets from the platform and asks them to continue withdrawing bitcoins
From the LocalBitcoins wallet. According to the announcement, users can withdraw crypto assets from LocalBitcoins for a period of 12 months. “Of course, we encourage you to download quickly,” the company noted.
According to the suspension schedule, LocalBitcoins will stop new registrations immediately starting February 9th. Trading will be suspended on February 16, while after that date users will only be able to log in to the wallet to withdraw their funds.
The sudden shutdown of LocalBitcoins comes shortly after the US Financial Crimes Enforcement Network identified the platform as one of the largest senders of bitcoins to the Russian-linked Bitzlato exchange. US authorities have launched a major enforcement action against Bitzlat, accusing the company of money laundering and That helped avoid sanctions against Russia.
Jukka Blomberg, Marketing Director of LocalBitcoins, denied any partnership or relationship with Bitzlat in a statement to Cointelegraph in January. He said:
“Based on our data, there have been almost no transactions between LocalBitcoins and BitZlato since October 2022, when we stopped providing Russian user accounts and accounts of users living in Russia.”
Blomberg also emphasized that LocalBitcoins has been regulated by the Finnish Financial Supervisory Authority since 2019 and strictly follows know-your-customer and anti-money laundering regulations.
Related: Binance blocks some accounts in Bitzlato’s case: “Funds are safe”
As previously mentioned, Russia used to be the largest market for LocalBitcoins and as of June 2020 surpassed the trading volume of Bitcoins on the platform. Total trading volume on LocalBitcoins has declined since peaking in December 2017, according to data from Coin. Dance.
The weekly Bitcoin trading volume on LocalBitcoins dropped below 1000 BTC in February 2021 and has never recovered since then. LocalBitcoins’ last recorded weekly BTC trading volume reached 283 BTC or about $6 million. By comparison, major exchanges like Coinbase trade $282 million worth of cryptocurrency per day, according to CoinGecko.