Bitcoin Forum

Besides the security issue of handling lots of money in public what's stopping people who are familiar with bitcoin from opening a 'local bitcoin guy' business charging 10-15% for changing cash into btc?  This would be the same service people list on Mycelium Local Trader and localbitcoin.com.

it is not an easy job to do. the security is the biggest one but it is just the start.
there are also legal issues that you have to think about like AML and all those acronyms for money laundering in businesses. also tax laws.

and after all this you should know how to advertise your business and make it profitable. in many countries just making the local exchange doesn't mean success!

Besides security and local laws,I thing it also requires good investment.I dont know hoe much but I think minimum you need around 10 BTV to set up an exchange

You need money for that, except that security is one of the biggest problems. I don't think I'm smart enough for this, some better hacker would stole all I have, and what other people have.
This is not for everyone, people will lose more money in trying then profit from this business.
I will not try ever to run exchange site, or any site. Even if I do I will hire people to do things there.

So many things:

• Regulations
• Upfront cost
• Operating capital
• Risk of theft
• Barely anyone in my area uses bitcoins so I would be making nothing or next to nothing

Those are the biggest reasons in order from biggest to smallest but they're all very important.

the first thing that a local bitcoin exchange business needs is customers. and as long as i can't find enough people around me who know about bitcoin i don't think that is such a good idea.

apart from that, if there is enough people interested in using such service and i can get over the regulations and also the initial capital needed for starting it, i don't really see any other obstacle and i will surely do it.

You need a huge capital, plus good reputation and the hassles of law enforcement agencies. It's not a peice of 🎂 that you think and open up. You need to plan a he'll lot. Pay lawyers fees, set up charges, secure platforms. It's very risky and a pain job. Are you really sure you wish to do it?

For instance in my country localbitcoins is blocked.
There are ways to circumvent this blockade, but it's not really worth it when you're not living in one of the major cities, or at least close to it.Not enough demand!
Furthermore it can be risky as you never know who you are dealing with. I never had problems so far, but I was always buyer side so far and my seller has built up very good repuation over the years he is doing it now.
And of course you need some starting capital, for instance to get the coins cheaper on the exchanges and sell them for a few +% person to person.

I guess it is the fear of getting robbed, beaten and shot in one night?

When the money is involved directly, it gets dangerous dramatically. You can sell so many stuff without a problem but selling money a bit different.

I don't even mentioned that the government will not like you. To open a local cash exchange, you need to get licences. You may not take much attention at first but when your business is big enough, the government will want its piece, or else jail time.

probably because there is no demand long term for such a business where i live anyway.  most people have only just heard about bitcoin.  why would they want to give over cash for something they cant even use in their local community?

I have thought about opening some sort of local bitcoin buy/sell site just like cashtocrypto and accept local payment gateway or local banks so issue regarding security of bitcoin may not become big issue for me as all process will be manual.

But i haven't opened that site till now because i still have some fear of getting investigated by government or getting my bank accounts/payment gateway accounts blocked which are linked to this site. There is no any clear explanation regarding bitcoin like cryptocurrency here in my country. However without site i am already doing buying and selling with good price margin, demand of bitcoin is quite higher right now here.

you are talking about starting a new business first then it is about bitcoin. and a lot of people (me included) are not so willing to risk getting into a new business and risk starting a new one.

and although it can be good and profitable, a lot more than having a job behind a desk but it is not easy and needs a risk-accepting personality and also some capital which not everyone possess.

I had planned to open a bitcoin exchange website but what stopped me from opening is that only few knows about bitcoin and opening a exchange site is not a big deal but the problem is to win trust and popularity I have to spend lot of money and that too can't guarantee whether i could make profit or not.

There are many reasons why I am not creating a exchange site. It is hard to make a script of a exchange site and you need to have a good domain and a anti ddos protection. Youll need to have a time to spend in our website and lot of money to have an alt coin on your site. You need to a trust from your customers.  Its hard but if your sites go famous you will earn a high profit

Local bitcoin exchange business seems pretty good to do but some reasons we need to consider, the main considerations are the capital and security.
I think this requires a lot of money and the ability to secure, promote, and gain the trust of the people. but for the beginning you can start from the scratch where some people already did it, without site and just using facebook.

funny you should ask :0
I have been thinking about this for a while and despite so many others here who say "capital" i have no problem with capital because i can start small and also i can take investors and there are already some friends that we are going to partner up.
the biggest problem is the regulations that i am so afraid of, and i am afraid it may change in the future like making bitcoin illegal and them i would be screwed!

Well in my experience, i have got problem there are no many people who know and understanding about bitcoins and other coins, of course they don't use bitcoins and the other problem bitcoin's price is too high so it will need much capital.

No volume, not enough starting capital, and no real reason to make one, regardless of whether or not I would be able to set it up for free.

The volume in my area would be terrible, even online or whatever. Maybe make, at best, $5-$10 a week on fees.

actually the main problem is of only trust .
some months ago one of my friend started a site with buy a domain of .com but the main problem with his exchange site was the people ( 500 resister) who are using bitcoin and want fuat no believe at the site and about 4-5 deals in per month .
so the main things to be get trust and advertisement .

It's not as easy as buying candy in a store. There are lots of things people have to consider before making such business like that. First of all, they must comply with money and regulations of a certain country to make their operation legit as it involves money. Also you need a big capital here as a start and a good bunch of operational team which you will pays plus the advertisement you will make.

So for meantime, people can do a small exchange and promotes in social media. In some of our local bitcoin group, there are persons who are converting bitcoin into cash with a certain fee. Although it only has limits and can't performed a big amount conversion.

Because there is very security issues associated with that type of business.

This is not an easy job. Specially in countries where bitcoin is not that popular yet. You need invest some money in it in order to get the exchange ready and working, hire workers, pay electricity bills, renting bills and so on. If you cannot ROI that amount then you are the loser. It would be profitable only in those places where people use bitcoin in the same manner that they would use fiat, otherwise not.

The first one will be the bitcoin popularity, in my place bitcoin is still not really famous, the second problem will be tax, when you do transaction in fiat with big number, the government will be suspicious and the last one is i believe if i opened a local exchanger i will be accused of money laundry

despite the fact that bitcoin is still not so much popular in my area, and still very little people know about bitcoin still i am welling to open a local bitcoin exchange business, as our government has not yet declare bitcoin as illegal therefore i have the advantage to open a bitcoin exchange, through this way bitcoin will also be introduce to people and people will start taking interest in bitcoin.

not having enough bitcoin i guess :)

Just thinking about meeting with someone i don't know can be a real threat, the thread could be to both parties. there was a thread here where a buyer was robbed upon meeting with a bitcoin seller.

If you want to make business you need money and in this situation huge amount of money. That is the main reason which stops me from opening a local bitcoin exchange business and also in my country most popular bank already has this service and people are using that but good opponent is always good to make service better in both side. I can't open bitcoin exchange business but I am offering people hosting in my country and now I don't have concurent in this job.

Few are the people who uses bitcoin so opening an exchange bitcoin business is risky, i would prefer to open a business that accepts bitcoin as a payment method rather than acutely exchanging plus it is a lot of money to handle

First of all there is a big competitor here, bitcoin exchanger with best service also there are some people open they service with lowest fee than that exchanger.
As for me there is no way to open your own service unless you have a unique or maybe offering lowest fee than their fee. On the other hand you must have big capital to start this business.

I live in a quite small community where just a few people uses Bitcoin. So there will not be a very large number of customers and for the people who are using Bitcoin is more convenient to use online exchangers. In my case opening local exchange wouldn't be very smart business idea.

The number one reason which stops me opening this business is the lack of customers.

I can`t figure out any other good reason.

We don`t need local btc businesses.I wanna build a global btc business.

A lot of problem, the security and especially about for opening the local exchange are not easy, a lot of people will saying a scam site without knowing about their credibility before. and i think for the operational are so high, but this just applied if you're wanna for opening a local exchange with using the workers.

Hey everyone its Brandon from cashtocrypto.com here. Acquiring customers and dealing with money service business regulation is tough and combining the 2 makes it a very difficult business to run. Whether you are selling on Localbitcoins or have your own website you still face the same requirements as far as compliance goes. You need an attorney familiar with compliance for bitcoin trading companies. There are maybe 4-5 attorneys in the U.S. that have this skill set, and their hourly rates star at about $600 an hour. After you retain an attorney, you will be informed you need to create a bsa/aml policy and a risk assessment, which will cost thousands of dollars to get the right documents. Next comes monitoring all transactions and customers as well as filing suspicious activity reports if necessary. It looks easy on the surface but its definitely not. There are many factors of risk at play, and you have to consider how much risk you can handle.

In the near future, we will be taking on additional sellers at cashtocrypto.com. You will not have to worry about acquiring customers as we already have a large customer base. In addition, I will be available for consulting at an hourly rate (much cheaper than any of those $600/hr attorney). I`ll be able to teach you everything you need to know compliance and otc bitcoin trading to be extremely successful.

No I Don't Think that Anything is Stopping People From Opening a Local Bitcoins Exchange Business and Also Now Bitcoin is Also Telecast By a Popular News Channel Zee News and Now it is Possible to Explain About Bitcoin to People More Easily and Comfortablely and Also I Know That What Problem Arises Or Not and If  I Want to Open a Business Like this Then I Don't Care About the Problems,  I Only Focus On My Business.....

For me personally, it's the investment that's stopping me from doing it. Sure, I could loan money from some people, but I would not feel safe going about it that way.
Plus I'm unsure of the legality and tax issues, seems too much work.

So far only large amount of investment in exchange platform web application and registration of the exchange is stopping me from setting it up. Also I don't feel so confident in running an exchange because could of years ago few exchanges have been raided by the Income Tax authorities and they're still under constant watch even though exchanging Bitcoins are legal. I think the sole purpose of the IT authorities doing so was to monitor if taxes are being paid in accordance to the laws.

Bitcoin is being used for a small number of people, and i dont know how many does uses and know about bitcoin, sure providing an exchange service with my cellphone or computer would be great, but the risks to walk in the streets with money its huge. For me its about the costumers and the risk to walk with money.

if i have enough money to have business like that i do not hesitate to build that one since bitcoin has a good future to be great decentralized currency. I think there is no thing to stop me because that business also promote the bitcoin in my area and i think more people will start adopting bitcoin since there is exchange in our area.

As in my own case, there are lots of people who do the local bitcoin exchange but they do not accept cash, instead they ask the buyers to deposit the money into their bank account while they send them the bitcoin. By doing so, the risk of facing high security issues is minimized to a greater extent for them. But for bitcoin seller, dealing with bank accounts has lot of complications may attract taxes as per my countries law.

First of all I don't want to, besides that a Bitcoin exchange requires big capital which I don't own neither I am willing to loan.And last but not least, a business like this would be a complete failure in my region for the simple reason that there are not enough people who use Bitcoin here.

There's no demand for such service, I don't open a "local bitcoin exchange" because there's no one to serve...

I think one thing that stops me from being that 'bitcoin exchange guy' is the fact that I want to remain alive. People can easily just set a meetup with you and tell you that he's exchanging all of his coins into fiat. You would have to bring all of those cash then. He can easily set you up and rob you, possibly even kill you. Meeting up with people from the Internet isn't something safe. Simply revealing who you are will open doors for people to go to your place and rob you.

When you feel yourself strong, someone can't rob you easily. when people contact you through internet and need to reveal the identity at some point don't always think in a negative manner that you'll be robbed.
I planned for an exchange in my locality and at some point dropped the plan of implementing because there is not much people aware of bitcoin in my locality. So started trading through different trading websites.

starting a new business is neither easy nor always profitable. you have to have some sort of background in the area before starting a new business especially if you want to start a service that already exists like a bitcoin exchange service. that way there is already a set amount of standards that you have to stick to and follow to be better than the competition.

There used to be quite a few people in my area that used Bitcoin but I haven't met another person using Bitcoin in my area in almost two years. I wouldn't have any business if I tried that.

Oh, and my government would probably try to put me in prison like they did BurtW because I can't afford the half million dollars worth of start up costs and licenses.

The most important problem that stops me from opening a local Bitcoin exchange business is the nanny state and its oppressive restrictions. Operating a exchange without the proper "licensing" can quickly lead to arbitrary prosecution measures by the numerous imbeciles of the officialdom.

Besides of that the demand for local Bitcoin exchange is not high enough, to warrant constant business activity - especially not if you have astronomic surcharges. Communicating with you customers and organizing a meeting can require a lot of time and there is an additional high risk of getting scammed / robbed by your customers, so you always have to be in alert mode when doing larger transactions.

So I think there are easier and less risky ways to earn money.

ya.ya.yo!

i think i don't have much bitcoin to start local bitcoin exchange business because as far as i know, its really need much of money and bitcoin because we are giving our services to our friends for first and the order is really need some money and bitcoin. maybe if i have much bitcoin and much money, i will open my local bitcoin exchange business because i see the profit is really good.

Another problem is law and regulation by government,add to that  the corrupt bureaucracy. Also, with infrastructures as you do not want to operate with frequent internet disconnection.Another maybe is the potential customer as you must do a very rigid promotion for the community to accept.

Actually opening a bitcoin exchange businesses needs lot of  initial investment which i don't have. I can't afford to buy even 1btc so opening a exchange with less then 1btc is useless who would come to buy bitcoin from me. Let me get rich then I will think  of opening exchange site. And also I can't afford to loss my money in any condition

It depends on a lot of aspects. Security is a major factor since in many countries, you'll lose money if you decide to put a bunch of money in the street no matter how safe you protect it. Also, law is something you have to deal with as in some area there are restrictions on bitcoin. Moreover, it's how popular bitcoin is in your country that you need to think about before opening a bitcoin-related business.

The policies that are made today,do not always stand up years from now under a new government.
People seem to forget that public opinions can sway and suddenly bitcoin is the root of all evil,grab a pitchfork and lets go get some bitcoiners! This thought crosses my mind everytime I make a purchase with my debit/credit or even grabbing a book at the library. 1984 scared the crap out of me and its fingerprints are still on me today when I think about big brother.

So stating that I think people putting themselves out there are truly amazing people and I admire their potential sacrifice.
Establishing a local exchange would not be in the cards due to my more laid back vibe as well,rather not deal with the stress of it all.

I think this requires enough capital for investment and a secured security....!!!

Business/company require licence from local authority and regarding bitcoin it is hard to get any license to operate service related to bitcoin.

To provide service only via a simple exchange webpage or simple facebook buy/sell group can be profitable as you can always buy/sell for margin, the only thing which stops me starting this way is large amount of local currency and bitcoin in hand to meet the demand. And if there will be no one to sell you in cheaper rate from where you can get bitcoins in market rate as there will be no local exchanger or trading platform.

There are a number of factors to be considered if opening a Bitcoin exchange business.
1. Security
2. I would also presume that there are some legal ramifications that are in place when opening such business.
3. Customers - There aren't a large number of members in this community. Unless one's area is flourishing with Bitcoin, I don't think that it would be a very good business.
4. I also think that people would opt for Bitcoin ATMs. These machines charge a very small exchange fee.

Is not easy, to start a local exchange business and it depends in majority of your country.
The biggest problems are money,laws and security. If your exchange gets involved with a security problem or one bank freezes the funds of your exchange this could be a big trouble.

Well, I've tried to sell some BTC with localbitcoins in 2 different cities. Once in France, once in Spain. I wasn't hungry, I chose to sell only 4% above spot. I didn't got a single request. Not an email. I've also tried many times to explain BTC to people I met in bars, or anywhere. People are interested, but when I propose to sell them some, they say tthey need to think about it. It ain't easy to run a business... I guess that if I were to open a shop, I would sell sodas or anything that people do not think about it.

There are a lot of things to consider why something is stopping me to open a local bitcoin exchange business.

1. There are already a good exchange here in my country so I am going to have hard time competing with them for I admit they are better than my developments.

2. Budget is really stopping me, I don't have enough budget for building my own local exchange site and no one wants to support my idea.

I haven't really planned on opening my own business that focuses on local bitcoin exchange. First and foremost of the reasons is the fact that I have not enough capital to begin with. Another would be the tedious procedures it would take, as far as my country, to complete requirements in opening up such a business.

Having a local bitcoin exchange business is very a profitable and very nice business but what stopping me from opening one? First of all i don't have the fund needed to hire someone to create me this site that can integrate every currency to exchange in Bitcoin , second is you also need fund to make sure to have the best security for that website and you also need to hire debuggers that will detect all the possible bugs that can occur to your system.

Aside from what has been said like security, operating expenses and capital, whats stopping me from setting up my own exchange is knowledge on setting up a business like this and courage to jump in this kind of business as there are risks involved. If ever I will dive in this this venture I would need a partner who knows how to run a business like this for starters.

I don`t think I have necessary skill to run exchange, I don`t think this is a joke to create and run exchange that will have profit in the end of the month. Except knowledge from economy, I don`t know so much about laws so I would need to pay a lawyer to tell me about laws in my country, I presume that for every country different laws are applied.
To not mention money for beginning, for advertising, for hiring security, and million other things. There is no way I can do this, it`s better for me to do it off the records with people I know, but not so many of them know about btc.

I don't think you have to meet your client in person.  If you are a bitcoin exchange guy, am sure you already setup your exchange site.  From there they can deposit their bitcoin and you can deposit the cash on their bank.  So what is the purpose of you having an exchange site if you go out and trade in person.

Well the Bitcoin community still consists mostly of nerds and typically nerds don't embrace face to face meetings  :D They're more comfortable being anonymous behind the screen of their computers in their bedrooms. Plus it's a bit risky to transact big sums of money with strangers. Still I'm sure we gonna see more of these popping up over the next few years.

well that's just not true.

it may have been true like 5 years ago when nobody knew about bitcoin and only 2 guys were mining bitcoin but these days bitcoin is used in a lot of places as a currency and online payment systems and also it is used by a lot of others as an investment, a way to make some profit or save their money in.

and it would be great if all of these users could have had some means for buying bitcoin "locally" not have to go to a centralized exchange service website outside of their country and buy from them.

Too much money, to many laws, to many licences, yes it does sound like for bitcoin exchange we need a lot of money to pay all that, but my point was that even with money you can`t do it if you don`t know basic things for that business. In case that you don`t have knowledge you will need to hire people to work for you, that is one more expense on already too much expenses. How much money you plan to give to this people that will work for you, that much they will be good. More money you pay better team of experts will you have.
This is not for ordinary people with some extra money, this is for serious investors with many connections and big bank credit.

Well, there is one such place in my city already. And the business is cruel, so I don't want to get in trouble. And there aren't many people using Bitcoin here, so I don't think it is very profitable. Moreover, this will count as illegal business in my country, because Bitcoin is out of the law and you don't pay taxes. Oh, and I guess in my city those who use BTC are mostly drugdealers, so I don't really want to have some common things with them.

I think the most issues is related to money laundering. Because for some fiat money you can risk a sue, or bigger problem with justice.
more over it's also risky make an exchange with stranger, you can't know who is your client (maybe a terrorist, criminal)...

I think so too, in my place everything that deals with business doesn't get away from taxes and if it does, it'll be considered illegal so bringing bitcoin which is totally tax-free into business is a risky move. Moreover, the people here seem to have no idea about bitcoin so it's hard to run this business.

You need a lot fo funds to run this kind of business,not only fund,but also technical knowledge plus you have to be compliant on the country,where you are going to run your business.

We have to pay the taxes. Even if we use the bitcoin, we should still pay the tax to support the society.