The trading volume of Paxful has surpassed Localbitcoins for the first time, which means Paxful is now the biggest peer to peer crypto exchange. In fact, this is the first time Localbitcoins has been surpassed by any other peer to peer crypto exchange.
The reason this is happening is because Localbitcoins has taken the ‘local’ out of its business by banning peer to peer cash for Bitcoin (BTC) trades.
Indeed, the bread and butter of Localbitcoins was that it could be used to find local Bitcoin (BTC) traders, and for years Localbitcoins was the only way to buy or sell Bitcoin (BTC) with cash.
Localbitcoins began to decline in recent years due to the rise of crypto ATMs, which are often more convenient than Bitcoin (BTC) dealers.
However, the real death blow for Localbitcoins was new regulations in Finland, where Localbitcoins is based, which made peer to peer crypto trading illegal since crypto for cash transactions lack proper know your customer (KYC) and anti-money laundering (AML) protocols.
At this point Localbitcoins offers no local cash capability, and only non-anonymous online payments, making it just as intrusive as a typical crypto exchange.
On the other hand, Paxful offers local cash crypto trading, so all of the in-person crypto dealers are now using Paxful instead of Localbitcoins.
Therefore, this is not just a temporary blip or a fluke, and Paxful will likely continue to gain volume relative to Localbitcoins long term.