We love Ethereum and were excited to hear about LocalEthereum.com. It was touted as the Ethereum version of LocalBitcoins.com. We happily signed up and right away we noticed that the default 2FA they require is through email.
It is awesome that they require 2FA. Email is a slow way to do it and if someone has your passwords it means they can likely also access your email so it isn’t very secure. We found that Account>Security>2FA allowed us to change it to Google Authenticator.
We decided to post some ads and waited. While we were waiting we got an email that we could sign up for a referral link but the https://localethereum.com/refer page didn’t work.
And waited. And waited. For the first few weeks or so, nothing.
Then the scammers came. There are 3 of us that have accounts on LocalEthereum. We have 7 ads between us. We have had 46 people start trades with us and only 2 of those were legitimate buyers/sellers. Then they website wouldn’t fund the trade correctly so that was an issue. The other 44 were scammers.
96% percent of our trades on LocalEthereum were scams.
We asked LocalEthereum about this and this was their response.
“Thanks for sending that list through, i can confirm they are all suspended from the platform, most were automatically picked up by our anti-fraud measures.
We are looking into many different ways of eliminating scammers, the biggest hurdle being that because the site is private we want to eliminate the ability of users to false report for personal gain.
We are working very hard behind the scenes to implement an easier way, until then we can be contacted here at any time.”
When we check the profiles they claimed were suspended, every profile was still showing. There is no notification on a profile that the account has been banned (like on LocalBitcoins and Bitrated)
When we originally contacted LocalEthereum they hadn’t prioritized banning scammers. They prioritize the appearance of the website over security and safe trading. Creating a support ticket, going back to your email and verifying the support ticket, then waiting for a reply is not a realistic solution.
On 3/14/18 a full 3 months after our first trade LocalEthereum rolled out the ability to report someone inside the trade. When we tried to report the scammers we received the following error
“On no, an error has occured
Cannot read property ‘toString’ of undefined”
A few traders we spoke with believe that LocalEthereum doesn’t want us to report scammers. That would be extra work for LocalEthereum or they are scammers themselves. They likened it to the Bitwallet.cc exit scam
We hope that LocalEthereum gets better. We really want it to work. Unfortunatey right now we just don’t trust a website that makes appearance a higher priority than protecting people’s money.
2FA is required/default
The website is very buggy and doesn’t seem to work.
The vast majority of trades started are scammers
Most of the professional traders we have talked to have not been able to complete a trade