LocalCoinSwap Interview – P2P Evolution


LocalCoinSwap Interview – P2P Evolution

LCS – A peer-to-peer bitcoin and altcoin cryptocurrency marketplace, owned by the community

LocalCoinSwap is the world’s first peer-to-peer cryptocurrency exchange that does not require any identification documentation to get started or have any restrictions on trading. Unlike centralized cryptocurrency exchanges, LocalCoinSwap offers over 250+ payment methods, 160+ fiat currencies and is available in over 190+ countries worldwide making it the largest selection of currencies in the world. A secure escrow protection system has been integrated into the platform to solve some of the inherent trust issues that arise from P2P trading and 95% of funds are held offline. The LocalCoinSwap team pride themselves on creating a product that is “fast, secure and private”.

LCS is the cryptocurrency offered by the platform, an ERC-20 token, and they use blockchain technology to distribute 100% of the site’s profits to all holders of LCS Cryptoshares token in the form of a redeemable dividend token.

Holders of the LCS token will receive dividend payments every quarter and contribute in the long term vision of the company by being able to vote in a proof-of-stake system in true democratic fashion.

The full LCS product was launched on the 26th February after running their ICO in April 2018. Since then, the team has continued to provide the community with regular guides and updates to the exchange:

LCS provide regular content and guides

In Conversation

I sat down with the COO, Daniel Worsley, to discuss the project further covering a wide range of topics.

February 26 was the hard launch for the exchange. How have the first couple of months of operating been and have you had any success/troubles?

The first few weeks of platform operation since the hard launch has been great. In the first week alone we saw an average of 100 user signups a day. We have been encouraging site users to provide as much feedback as possible regarding any sticking points that they have had in the user flow and trading process so that we can make UX/UI adjustments to ensure a smooth user experience. We are also using this feedback to create user guides (written and video) to help those who are newcomers to P2P trading through their first trades.

No big software launch would be complete without a few bugs. However, as we have been well prepared and focused heavily on UAT and QA testing in the months and weeks leading up to the hard launch, the only bugs we have seen were minor issues like new site translations not fitting correctly on buttons, and a small issue we had with our third party service that was providing SMS notifications. These have now been resolved.

The day of the hard launch also coincided with the date of the first LocalCoinSwap Cryptoshare holder dividend distribution. We are very pleased to announce that this went exceedingly well. The feedback from our token holders has been overwhelming. Even those users that are relatively new to blockchain have easily been able to claim and redeem their dividends in 6 currencies (including BTC, ETH, LTC, LCS and more). These are the currencies that were traded on the platform throughout the beta-MVP period.

In a recent press release it was stated that you’re ‘taking direct aim’ at LocalBitcoins – a similar project to your own. What are your USP’s and what makes you stand out from competitors?

I would first like to comment on the fact that myself and the team are very thankful for everything that LocalBitcoins have done for Bitcoin and Cryptocurrency in general. They were the very first P2P cryptocurrency platform, and they really helped drive accessibility and adoption to the Bitcoin market in its infant stages. However, a platform that is built on old technology and refuses to innovate cannot keep up with the rest of the industry. Bitcoin is no longer the only cryptocurrency, and people need a platform where they can trade more than a single cryptocurrency P2P, in one place.

Currency agnosticism is one of the first and most obvious of LocalCoinSwap’s USPs. You can already trade over 20 of the top cryptocurrencies on LocalCoinSwap including Bitcoin (BTC), Ethereum (ETH), Bitcoin Cash (BCH), Litecoin (LTC), Monero (XMR), Dash (DASH), Tether (USDT), XRP (XRP), Dai (DAI) and many more. None of the leading P2P marketplaces offer such a range of cryptocurrencies for their users so this is definitely a unique selling point of the LocalCoinSwap platform. We will also continue to add cryptocurrencies that have unique benefits for users or are in great demand.

Secondly, LocalCoinSwap is the only community-owned, P2P cryptocurrency platform. Currently, we have around 4000 token holders who all take their share of the platform’s profits each quarter. This means that there are around 4000 people invested in the success of the platform. These token holders are constantly providing feedback on how we can improve, not only the platform but also all other aspects of the project.

We developed (and will soon be expanding) our very own LCS ambassador program. This consists of a group of token holders/community members who are passionate about the project. These ambassadors assist the core team in a wide variety of functions including community-building, marketing, and B2B/B2C outreach programs. Very soon we will be taking on some more ambassadors from our target nations to assist in more directed business development and user growth activities.

Finally, the fact that we give 100% of our profits from LocalCoinSwap back to the crypto community is a huge USP. There isn’t another exchange in the world that let’s their traders profit from both tradings on the exchange as well as own a part of the exchange that they trade on and we are proud to be able to offer this back to our users, investors and the wider cryptocurrency community.

You can buy and sell multiple cryptocurrencies globally

On the exchange, each trade lists the location of the buyer/seller. Are you seeing an increase in interest for Crypto in countries such as Venezuela which is going through its own economic crisis of the bolívar?

Yes, we most definitely are seeing a growth in users from countries that are going through economic crisis. Many people would have read some of the articles that have been floating around discussing the huge rise in P2P bitcoin trading in Venezuela as well as other unstable economic regions. It makes total sense that the people of these nations would turn to cryptocurrency, and P2P trading is one of the only avenues that they have access to in order to purchase cryptocurrency. Even though we have seen a huge drop in the prices of Bitcoin over the last 12 months, these losses are nothing compared to what the locals in Venezuela have experienced simply by holding their local government issued fiat currency. To put it in perspective, throughout 2018 Bitcoin devalued against USD by 72.77%. Yet the local currency of Venezuela decreased by 99.6% in just an 11 day period between January 25, 2018, and Feb 5, 2018. This caused the government to issue a new currency that has also seen a trend of devaluation.

Many of these countries have strict capital controls that stop everyday people from being able to easily avoid these crises. For example, if I am in Australia and I feel like the AUD is at risk of seeing a large devaluation for any reason, I can easily go down to my local currency exchange and as long as I have sufficient identification, I can easily turn all of my cash and savings into a currency that I may have faith in like the USD or EUR. People in these countries often do not have access to such facilities outside of risky and pricey black markets. So this is where P2P cryptocurrency trading has a great use case. Anyone can go to LocalCoinSwap and trade their local currency to a cryptocurrency that can be easily transacted without any permissions needed from regulatory authorities.

We are also seeing increases in users from jurisdictions that are implementing crypto unfriendly regulations.  

DAI, a stablecoin, was recently added to the exchange. What’s the significance of having a stable coin on the platform going forwards?

Great question. Allowing stablecoins to be traded P2P, gives people an even better way to be able to stave off hyperinflation and avoid capital controls. Look at all the individuals from Venezuela who purchased Bitcoin in early 2018 to keep their money more stable and are still holding. If they had access to a platform like LocalCoinSwap and were able to instead buy DAI at the same time, they would now be over 3 times better off.

Additionally, if someone is using P2P trading to allow them to easily remit money overseas, using a stable coin carries a lot less foreign exchange risk than using something like Ethereum or Bitcoin.

A key feature of your platform is that 100% of your profit from trades goes to the crypto community. Can you explain how this works?

The tokenomics behind the profit sharing model is actually quite simple.

LocalCoinSwap makes revenue from a 1% fee that users pay when they complete a successful trade on the platform. We pay the required operational costs to keep the platform functioning (server infrastructure, security costs, and wages etc.) out of the revenue, and then we distribute the rest, which is the profit, to all LCS Cryptoshare token holders.

Each quarter, every person who holds LCS Cryptoshare tokens receives a dividend token to whatever wallet is holding their LCS Cryptoshares, our unique platform token. This is just a simple ERC20 token that they can buy and gives them part ownership of the LocalCoinSwap exchange. They then send this dividend token to the LocalCoinSwap platform and redeem it for their share in the platform profits. These profits are paid in the very currencies traded on the platform and are distributed directly into the user’s wallet, for them to sell or hodl.

It is important to note that this does not mean that the team does not receive any benefits at all. The core team was allocated 10 million tokens so that means that they receive about 13.75% of the total platform’s profits. It is important for the team to have some stake in the project to keep incentives aligned into the future.

One of the main reasons behind the profit sharing model is to allow everyday people to share in the success of a cryptocurrency exchange and to use the ideas, insight, and knowledge of these people to develop a world-class peer-to-peer marketplace. For too long have a select few individuals, who own the biggest platforms, made themselves millions off the backs of everyday cryptocurrency traders and we don’t want that to continue with LocalCoinSwap. We want to do what we can to put the profits back into the hands of the people that matter – the cryptocurrency community.

There are a plethora of ways to pay for crypto

You have one of the most generous referral programmes in the space where both the referrer and referee can generate instant profits on any trade, more so if you hold the LCS Cryptoshares token. Can you talk about this decision to reward both?

Given that the idea of a referral program was not in the original whitepaper, we felt it prudent to put the issue out to a vote. We took ideas from the community on if they wanted a referral program to begin with, and how they envisioned the program would be structured. We then aggregated those ideas into 4 different options and distributed voting tokens to all LCS Cryptoshare token holders. The option that received the most votes was the one you described above, and thus was implemented as our referral program.

The idea to reward both the referer and the referee was not actually one that came from the core team. It was an idea put forward by some of our community members who were frustrated at the idea that when they used someone’s referral code, the referrer received the benefits and they received nothing. So with our referral program, there is an incentive for people to actually use the code and everyone benefits. Also, the tiered bonuses for those who hold higher amounts of LCS Cryptoshares, helps to drive demand for the token as you can, in fact, earn up to 30% if you hold LCS Cryptoshare tokens.

You already have 23 different cryptocurrencies, more than 250 payment methods, 180 fiat currencies and are available in over 190+ countries worldwide. How do you plan to expand on this in the future?

We have a few top tier projects that we will be partnering with to list over the coming months. These are projects that fit in line with LocalCoinSwap values, and have the potential to create value for both our token holders and create opportunities for people who now have access to buy and sell a range of cryptocurrencies outside of just Bitcoin in the future. Unfortunately, I cannot announce any names just yet but keep an eye out on our social media for upcoming announcements.

When it comes to payment methods, we are always happy to support all payment methods which can be safely supervised using our secure escrow protection. So if any users are looking to trade using a method that we do not currently support, they can contact us through our support portal or via our Telegram channel, and we will look to add it. In the last week alone we already added another 3 payment methods from feedback from our users in Venezuela, United Kingdom, and Australia.

The same goes for fiat currencies. If we can access accurate price data for a fiat currency, then we will add it to the marketplace so that users can trade with it.

Supporting a diverse array of payment methods on the platform is important as it allows many more ways that traders can benefit. It does this by increasing the amount of people that can a trader can buy or sell to, and also helps to drive overall cryptocurrency adoption.

Are there any exciting updates you can provide for the future of LocalCoinSwap?

It is funny that you should ask this. We used to announce many exciting updates to our community. However, it quickly became apparent that some of our competitors had been closely following what we are doing in Telegram and jumping on the opportunities that were put forward by the community. I won’t name any names but at least one competitor copied our referral program and another copied some other aspects of our marketing. All absolute fair play but we have learned from this. All I can really say is that we have a global vision for expansion and plan to initiate some great promotions for P2P traders in the months ahead and some fantastic partnerships planned with some top 50 CMC tokens. It’s important to remember that most of our competitors have been in this space for over 5 years now however we have a small team of people who are all experienced peer-to-peer traders themselves so we are always approaching our platform with agility and flexibility with the intention to create the best and most inclusive P2P platform worldwide.

I sincerely thank Daniel for his highly detailed and informative responses.

**If you would like to read the Russian translation of this interview please do so here. A special thank you to Valeria, LCS Community Manager, for translating this!

Alex Libertas

Further Reading

Coin Market Cap



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Alex Libertas
Alex is the Founder of The Daily Chain and has been in the space for just over two years. Fascinated by the community and everything that blockchain has to offer, Alex dedicated himself to creating content and contributing back to the industry.

The Daily Chain Partner with UX Consultancy Firm elevateUX

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