This tutorial takes advantage of a simple profit opportunity on LocalBitcoins; a person-to-person Bitcoin trading website.
This is not a buy and hold strategy. You will essentially be acting as a Bitcoin broker; buying Bitcoin under market rate, and selling it over market rate multiple times over.
There is a risk that Bitcoin might goto £1 at any point, bare that in mind. But aside from that, the profit margin tends to counter out any market moves. The trades pop-up pretty frequently.
- A LocalBitcoins account; if you sign-up as my referral(click the link), I’m happy to help you out.
- Starting capital. You need 0.4BTC. You’ve got the money, it’s not expensive, but its going to turn you into a fatcat. You can check the current Bitcoin price on Preev. Just type in 0.4 in the BTC box.
- A bank account. Both are equally important, as you’ll come to find out later.
- ID to verify who you are. No verification, no sales, no bitcoin, no profits.
This tutorial assumes you have some basic knowledge about:
If you’re unsure about Bitcoin then this tutorial probably isn’t for you.
There’s no harm in trying anyway, we’re not recoding Bitcoin or do anything super-techy. Once you make your first trade you should feel pretty comfortable with the process.
Go to LocalBitcoins & Register
The site is very simple to use, and has a nice minimalistic interface that cuts the shit, and gets you trading ASAP.
So goto LocalBitcoins, sign-up and fill out your details.
Verify your ID
Whether you’re buying or selling, on both ends, you need to confirm your identity. This process is for the safety of everyone involved in the trade.
If you don’t verify your ID then no-one will trade with you. And you shouldn’t trade with anyone that’s unverified either. Common sense, really.
Build some quick feedback
Easiest way to do this is do a number of small trades; buy Bitcoin from multiple people. Get to at least 10 feedback. Otherwise people will avoid you. Hit the Buy bitcoins tab.
There’s a number of people on the site, at different prices with different payment methods. You want to trade with National Bank transfer.
Open a trade offer with someone, and type in the minimum limit into the input box.
This process will get you accustomed to how the trades work, and build your confidence in the security of site.
Buy some Bitcoin under market rate
Once you’ve built a little feedback, it’s time to post a trade.