Buy Bitcoins Directly From a Person

person to person trade

Purchasing bitcoins directly from another person can be one of the fastest and most anonymous ways to get bitcoins. In most cases, you won’t be required to provide documentation that proves your identity or wait for a verification period. And if paying with cash face-to-face with another person, there is no need to disclose your name, address, or personal details.

The challenge is finding another trustworthy person willing to sell the amount of bitcoins you want at a price you are willing to pay with an agreed upon payment method. Online marketplaces exist to help buyers and sellers find each other by allowing them to post ads of the amount of bitcoins they are buying or selling, and their desired price. Additionally, some of these websites, like localbitcoins.com, offer an escrow service that protects Bitcoin buyers from fraudulent offers and any 0-confirmation double spend attempts. Additionally, the service’s built-in user feedback system can help you identify trustworthy people to trade with, as well as establish your own reputation.

Person-to-Person Bitcoin Marketplaces

LocalBitcoins.com“Buy and sell bitcoins near you”
Brother Bitcoin’s Rating

LocalBitcoins is the most popular and trusted website for buying and selling bitcoins person-to-person.

Escrow
User Feedback System
National CurrenciesAll
Supported CountriesAll
Payment Methods
  • Cash in person
  • Cash deposit
  • Cash by mail
  • National bank transfer
  • SEPA (EU) bank transfer
  • Transfers with specific bank
  • International Wire (SWIFT)
  • Paypal
  • Moneybookers / Skrill
  • more…
Fees1% of the purchase amount, applies only to released escrow transactions
Verification RequirementsFor most trades, no verification is required. For certain online trades involving bank transfers, your real name may be required, and the seller has the option to require a scan of a government ID.
Physical LocationHelsinki, Finland
Advantages
  • The service only holds seller’s bitcoins, it does not touch the fiat funds.
  • Escrow service can alert the buyer via SMS once the funds have been released by the seller.
  • Logs of transactions are deleted after 90 days.
Disadvantages
  • Inability to message another trader unless initiating a trade.
  • URLS and links are removed from trader-to-trader messages.
Bitquick.co“Connecting Sellers to Buyers Nationally.”
Brother Bitcoin’s Rating

Bitquick is a website service that lists buy and sell offers. Buyers must directly pay sellers with a bank transfer or cash deposit.

Escrow
User Feedback System
National Currencies
  • USD
  • EUR
  • INR
  • TWD
Supported Countries
Payment Methods
  • Bank account cash deposit (instant)
  • SEPA transfer (EU only, 1 day)
Fees
  • 2% per transaction to buy
  • 0% to sell
Verification RequirementsNo requirements for small orders. Large orders may require a photo ID.
Physical LocationCincinnati, US
Advantages
  • National currency transfers are made directly from the buyer’s bank account to the seller’s bank account — the service only holds seller’s bitcoins, it does not touch the fiat funds.
  • Escrow service helps protect bitcoin sellers from fraudulent buyers.
Disadvantages
  • Limited number of supported banks (many banks do not allow cash deposits into other people’s accounts)
  • Seller’s names and bank account numbers are revealed to any potential buyers.
  • Orders on the books cannot be combined — each sell order must be purchased separately.

bitcoin-otc“Over-the-counter marketplace for trading with bitcoin”
Brother Bitcoin’s Rating

bitcoin-otc is listing of buy offers and sell orders for currency and physical items. The service is non-proift, plays no part in trades other than listing them, and operates on a freenode IRC channel.

Escrow
User Feedback System
National Currencies All
Supported Countries All
Payment Methods Not applicable
Fees None
Verification RequirementsBitcoin address and a GPG/PGP public key.
Physical LocationNot applicable
Advantages
  • The service is a simple aggregator of submitted orders: there is no centralized service that accepts Bitcoin deposits.
Disadvantages
  • Requires an IRC client to be installed and familiarity with GPG/PGP.
  • Low volume and diversity of orders.
  • No built-in escrow service: traders must find and commission a separate 3rd party for escrow.

Advantages

  • Person-to-person trades are usually faster than using an exchange.

  • Purchasing bitcoins with cash from another person is the most anonymous way to buy bitcoins.

Disadvantages

  • Sellers mark up their price so they can make a small profit for their time and service — you’ll usually end up paying a slightly higher price per bitcoin than you would on an exchange.

Some Advice

  • Trade with users who have a high feedback score and a large number of trades. Most marketplaces track the reputations of traders via feedback. A trader’s reputation is important to their continued business because it establishes trust. So those traders have proven themselves to be trustworthy with others will have a high feedback score (around 100%) and typically a large number of trades. There is far less risk involved when doing business with an established trader.

  • Don’t keep a large amount of national currency or bitcoins deposited on a marketplace. There is always a risk that the service may suddenly shut down, and your funds will no longer be available to you (see the MtGox debacle). Try to only deposit the necessary amount, and then withdraw your bitcoins after trade or purchase is complete.

  • Use PGP/GPG encrypted messages for an extra layer of anonymity (advanced). Messages that you send to other traders on these marketplaces are stored in plain text on the service’s servers. Using PGP/GPG to encrypt these messages will help limit the visibility of personally identifying information (i.e. a meetup address, your real name, your shipping address, etc.) to only the person you’re trading with. Third parties, such as the marketplace service or law enforcement, will be unable to decipher the encrypted text. So when initiating a trade, first check if the seller has a public PGP/GPG key and ask them to send it to you. You can then use it to encrypt sensitive text about yourself and the trade; the encrypted text will only be readable to the seller. That is, of course, unless they decide to share it with others.