A Denial to Withdraw Bitcoins from LocalBitcoins Hinders Cross-Border Businesses

Users of localbitcoins.com, a popular cryptocurrency exchange platform, in over 15 countries from different continents are crying helplessly after being denied access to withdraw their Bitcoins from their personal accounts. This event came as a result of a surprise blackmail from the EU Commission.

As the cryptocurrency industry is growing faster and more rapidly, different things – both bad and good – keep on happening. Now, most people, especially those who make cross-border transactions have been for close to a month now waiting for things to change in their favor, but that is not the case.

Over a month ago, the EU Commission released a statement saying customers residing or located in 16 nations are required to have an enhanced due diligence process and these States are properly defined by the Commission. These countries include: Afghanistan, Bosnia and Herzegovina, Korea, Ethiopia, Guyana, Iraq, Iran, Lao PDR, Pakistan, Sri Lanka, Syria, Trinidad and Tobago, Tunisia, Uganda, Vanuatu and Yemen.

Was LocalBitcoins Hacked?

Generally, the whole issue is revolving around verification. After logging in to their accounts, customers were told to update their verification status to enable the outgoing transactions. So they were all required to proceed to the next step of verifying their identity. Unfortunately, none of those who tried to verify their identities were successful. The users’ hearts started beating at a high speed and the pressure started mounting – thinking that they are going to lose their money, and of course, finding it impossible to carry out cross-border payments. Actually, most users thought that the exchange had been attacked since hackers have been rampant for that last few months. Anonymous hackers including Lazarus Group, have been targeting cryptocurrency businesses and stealing everything looking like a digital asset.

Before deleting the account, customers are advised to first have (or create) another Bitcoin account where to send the BTCs that they have been holding on their LocalBitcoins wallet. Then they will be required to provide the receiving address where to send the BTCs to. The Bitcoin that has been sent to a new address will be available in the next 14 days (counting from the deletion date). However, if a user who deleted his/her account tries to log in the deleted account before the 14 days expires, his/her account will not be deleted, hence, he/she won’t access his/her cryptocurrencies.