Finland-based cryptocurrency exchange Local Bitcoins has hit a heavy snag.
Local Bitcoin Is Reporting Seriously Low Trading
As we all know, bitcoin – the world’s number one cryptocurrency by market cap – has suddenly decided to shoot up following news that India was removing its crypto ban and that South Korea was implementing new legislation that could potentially bring bitcoin and its altcoin cousins to the mainstream.
However, Local Bitcoins doesn’t appear to be benefiting from this news. In fact, the exact opposite is occurring. The exchange is reporting that the amount of bitcoin transactions on its platforms have hit their lowest numbers in seven years. That means trades on the platform haven’t been this low since 2013.
Apparently, people in Finland aren’t feeling the bitcoin buzz. The number of transactions recorded at the end of February was 3,144. This is down about 75 percent where transactions were during the previous year. During that time, as many as 13,000 individual bitcoin units made their way across the trading boards of Local Bitcoins.
The biggest trading week for the exchange occurred in 2015, in which 40,000 separate BTC units were traded back and forth.
Veruska Xavier Filgueira – content and communications representative at the company – explained in an interview:
Some of the volume variations are due to the level of activity of the bitcoin market itself, but our service already expected that the regulatory changes that occurred during 2019 would have an impact on the platform.
It’s possible, however, that Local Bitcoins is somewhat responsible for its own ill fortune. Last January, it was reported that the company was suspending or shutting down people’s accounts and failing to dispel why. Many people reported that they didn’t even know their accounts had been closed off until after they tried to access their funds. They received no warnings, no emails, nothing to let them know what was going on.
One anonymous user explained in a statement:
One of my customers was due to travel out of the country and had to sell some of his bitcoins to be able to go only to notice on his way to the airport that he cannot even access his funds.
It is widely believed that Local Bitcoins is looking to remain compliant with new European legislation that has set in, requiring all crypto customers to share their private data with the exchange so that the platforms can remain compliant. It is alleged that all who failed to take these steps were immediately shut out.
Why Are You Closing Accounts?
Local Bitcoins later issued a statement explaining that certain countries seeking to do business with the platform were subject to a heavy “due diligence process,” which was likely to take up longer periods of time.
Following the suspensions, Local Bitcoins activity fell by as much as 70 percent from where it was in late 2019.