Bitcoin exchange LocalBitcoins revenues up, despite losing ground to Paxful

Peer-to-peer Bitcoinexchange LocalBitcoins today posted its business results for 2019—and business is good, despite struggles dealing with money laundering on the platform and losing ground to rival Paxful. 

Posting a 10% increase in revenue from the year before, the Helsinki-based company announced an annual revenue of €26.2 million ($29.48 million). 

The company—one of the most popular cryptocurrency exchanges in the world—said that there were 1.46 million new customers on the platform in 2019 and €2.48 billion ($2.79 billion) worth of trades. 

It also said there were 15.6 million trades on the platform in 2019 and 913,000 active traders. 

These gains come after some difficulties for the company. The exchange has year after year been labelled as the number one spot for crypto assets of illicit origin to pass through, and last year took measures to combat money laundering and introduced a know-your-customer (KYC) regulation. 

It also stopped facilitating cash trading to make it compliant with regulators in Finland—leading some traders to ditch the exchange. 

What’s more, New York-based, peer-to-peer exchange Paxful is quickly catching up with LocalBitcoins in terms of trade volume: last month, Paxful beat LocalBitcoins in weekly BTC volume for the first time, according to analytics website Useful Tulips.

But LocalBitcoins is still continuing to grow, it said today in its report, despite there being a “few bumps on the road.” 

“The rapidly growing new customer numbers naturally are a sign of a healthy demand and great future potential for LocalBitcoins,” CEO Sebastian Sonntag said in a statement. 

“As expected, undesired activity was driven away from the platform and the implementation of KYC itself was a challenging process. Despite these, we were able to deliver growth and excellent earnings.”

“However, as said, change will take time and we need to stay humble and keep on serving our customers the best we can,” Sonntag said.

Of course, these are last year's figures we're talking about after all. To get a real sense of how LocalBitcoins' business has been affected by the growing field of P2P exchanges, we'll need to wait for the 2020 numbers.