Friday, December 21, 2012

Set up your own electronic bitcoin exchange using localbitcoins.com!

Today we have added a new escrow feature to localbitcoins.com. This differs from the previous transaction feature by being completely designed only for electronic money transfers and not for physical cash trades.

The service requires that you have bitcoins in your localbitcoins.com wallet before you can start using it. The escrow service is disabled by default, and currently enabled only for selling advertisements.

The service generates reference messages automatically for the buyer, so that doing the trade is very easy for both the seller and buyer. The buyer has just to pay the invoice automatically generated by localbitcoins.com, and the seller must watch his bank/payment service account and release the funds when they are spotted.

Every trade builds up reputation for both participants. We always suggest to be cautious with first timers - in the bitcoin community, bank account hackers sometimes use services like localbitcoins.com to buy bitcoins. Therefore check the reputation of the counterparty when accepting bank transfers. Banks will notice these transfers usually pretty quickly, about in 0-3 days. With new users with no existing trade volume, it is recommended to wait or ask for additional validation before accepting the transfer.

Of course all the existing features of localbitcoins.com are also integrated with the new process, such as messaging, feedback and SMS/email notifications. You can also specify your price using equations, as before. Examples:


  • Sell for market price, but at least 13.5 USD: max(mtgoxUSD_ask, 13.5)
  • Buy always at competitive but fair rate (EUR): min(min(min(mtgoxUSD, bitstampUSD), USD_24h)*USD_in_EUR, EUR_24h)


Read more about the escrow feature from our guide.

For more examples for equations and all parameters, see our cash exchange guide.

We are developing localbitcoins.com constantly forward, and more features will be coming all the time. Stay tuned!

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.