LONDON (Bywire News) – In a major blow to the privacy-focused cryptocurrency community, LocalMonero will suspend all trading activity as of May 14 and the entire platform will be shut down within six months, CoinDesk reports. Ta. The announcement was made by parent company AgoraDesk, which is also winding down its operations.
“After nearly seven years of operation, due to a combination of internal and external factors, we have made the difficult decision to close our platform,” the statement said. “We are extremely grateful for the love and support we have received over the years. We could not have done this without you. We love you all.”
This somber announcement was published in The Node, a daily newsletter that provides a comprehensive overview of the most important developments in the cryptocurrency space. Although the specific reasons for the closure were not disclosed, it is clear that intense regulatory pressure played a role. The demise of LocalMonero follows a similar fate for other peer-to-peer (P2P) platforms such as LocalBitcoins and Paxful.
The regulatory environment in the cryptocurrency industry, particularly in the P2P market, is becoming increasingly hostile, especially in the United States. Ray Youssef, Paxful's former CEO, echoed similar sentiments when Paxful shut down, blaming the closure on increased regulatory challenges.
LocalMonero was functionally similar to Craigslist and facilitated the buying and selling of Monero (XMR) through various methods agreed upon by trading partners. The platform has a reputation for requiring limited identification, making it attractive to users who don't mind paying a bit of a premium for privacy. Additionally, it offered an “arbitration bond” for security and held an equal amount of Monero in escrow to refund users if a transaction failed.
The closure of LocalMonero leaves a huge void in the Monero ecosystem. A unique selling point of Monero, the largest privacy coin with a market capitalization of $2.5 billion, was its privacy features that make transactions difficult to trace. However, major exchanges such as OKX, Binance, and Coinbase have delisted similar privacy tokens such as Monero and Zcash (ZEC) following increased regulatory scrutiny.
Privacy advocates and Monero users are currently scrambling for alternative ways to obtain XMR. Semi-anonymous privacy activist Seth for Privacy lamented the closure as an “incredibly sad day” and highlighted the challenges currently facing Monero users. On platforms like Reddit, users are discussing different ways to navigate this new situation. For example, you can buy cryptocurrencies like Bitcoin (BTC) or Litecoin (LTC) and exchange them to XMR using a privacy-focused wallet like Cake Wallet.
Elsewhere, the Bisq P2P network remains an option for cryptocurrency swaps to Monero. Kraken still has Monero on its list, but has restricted access to users in countries including the UK and Australia, and will soon add Ireland and Belgium to this list. Less secure methods include purchasing her XMR directly from an individual on a messaging app such as Telegram.
In a statement, LocalMonero recommends decentralized exchanges like Haveno and Serai for future transactions, both of which operate on the Tor network and employ advanced security protocols.
Despite these setbacks, Monero's network continues to operate, demonstrating the resilience and tenacity of decentralized systems. One Reddit user poignantly pointed out, “The federal government must really hate Monero. I think it's proof that they keep using it.”
While the fate of Monero and other privacy coins remains uncertain in the current regulatory environment, our community remains determined to protect privacy in financial transactions.
