In a move necessitated by new regulations on data protection, one of the most popular P2P crypto platforms is updating its terms of service. Headquartered in Helsinki, Finland, LocalBitcoins stated in a blog post that the move would increase transparency in how it provides its services and ensure that it’s compliant with the EU’s soon-to-be-enforced General Data Protection Regulation (GDPR). The new regulation will come into effect on May 25, and the platform has asked all its users to acquaint themselves with the new terms of service as well as the revised privacy policy by that date.
ID To Be Required In Select Situations
One of the most prominent changes to the terms of service is a new requirement that users produce their IDs for verification in some situations. P2P platforms have long operated without necessarily requiring their users to verify their accounts with their IDs. While verifying was an option – and in some cases even encouraged – it hasn’t been required in order for one to trade cryptos. Some of the situations which will require ID verification include:
- When trading over certain limits or when soliciting trades that are over a certain limit: the platform has yet to disclose the actual limit, but stated that this is to protect the site from being used to launder money and other unlawful activities.
- For account recovery: the platform pointed out that those users whose IDs are not verified stand the risk of losing their investments if they lose their account credentials. If a user’s account is hacked, ID verification will be employed for the recovery.
- For fraud investigation: in cases where an account is reported for fraud, the platform will require the user to verify his or her ID to aid in the investigation.
LocalBitcoins will also have the right to terminate or suspend an account if a user is accused of fraud with sufficient proof, or if the platform has reason to believe one’s account has been hacked, in which case the suspension will be done to limit the damage the hacker can cause.
The Privacy Policy Was Completely Rewritten
The platform says it has rewritten its privacy policy completely in order to adhere to the new regulations. The updated policy will include a detailed description of the data that the platform collects from its users and its reasons for doing so, with whom and how the data is shared, as well as its data retention policy. If a user decides to delete their account, the platform has a right to retain the user’s data for at least 5 years.
A month ago, a Reddit user by the name of Yellocuda reported that his ID had been required by LocalBitcoins, eliciting uproar with many vowing to boycott the platform. The site had advised the user to verify his ID as his trade volume over the previous 12 months had been significant.
Peer-to-peer crypto marketplaces have become quite popular in recent years. Their relative ease of transactions and integration with local payment methods have endeared them to many, especially in regions where strict regulations have hindered the growth of centralized exchanges. LocalBitcoins is one of the most popular OTC platforms out there, with the site registering steady growth year-on-year since its launch in 2012.
