The LocalBitcoins trading platform will cease trading in 13 U.S. states.
Only 10 states will continue to benefit from exchange services.
LocalBitcoins has not provided a direct reason for the trading suspension.
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BTC’s international exchange, LocalBitcoins, recently stated that it will suspend trading for more than a dozen U.S. states as of January 26.
According to the announcement, only ten states will be able to continue using LocalBitcoins‘ services. Those states include Illinois, Kansas, Montana, New Hampshire, New Jersey, Pennsylvania, Tennessee, Texas, Virginia and Wisconsin.
LocalBitcoins applies new restrictions
LocalBitcoins.com will cease operations in all but the ten remaining states by the spring of 2021. Exchange representatives added that operations will be suspended for the next two weeks in Florida, Connecticut, Utah, Arkansas, Nevada, Nebraska, Mississippi, Iowa, District of Columbia, North Dakota, Minnesota, Kentucky and Vermont.
LocalBitcoins will close accounts two weeks after the January 26th deadline and provide customers with a final withdrawal after that time.
The news was first posted on Reddit with the image copied from what appeared to be a message from LocalBitcoins. However, the post was removed shortly afterwards. BeInCrypto asked LocalBitcoins to comment on the validity of the message and received a response indicating that the information was indeed true.
According to Coin Dance, LocalBitcoins currently has a weekly trading volume of approximately $4.8 million in the United States.
Factors related to this suspension
The reason for this announcement was not specified, Localbitcoins simply stated, „It was a pleasure to serve you and we apologize for the inconvenience“.
That said, the announcement follows recent news regarding the U.S. Securities and Exchange Commission’s (SEC) decision to charge Ripple (XRP) with managing and selling unregistered securities. The ongoing case could put the cryptocurrency exchanges at risk and many have decided to delist XRP to avoid possible repercussions from the SEC.
The possible suspension of trading in the majority of U.S. states may be due in part to the SEC’s attack on companies that facilitate transactions in cryptosystems. Money laundering and fraud regulations vary considerably from state to state. In the U.S., peer-to-peer (P2P) transactions do not always meet appropriate Know Your Customer (KYC) and Anti-Money Laundering (AML) standards.
LocalBitcoins has not yet issued an official statement about the announcement, even though it has been confirmed by the platform itself.