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Author Topic: needing some feedback on understanding localbitcoins USD per BTC  (Read 67 times)
legend018
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January 17, 2018, 11:14:41 PM
 #1

Are these differences so that people can make a profit and incorporate fees that are involved?
Examples from localbitcoins

12377 price/btc on localbitcoins if going through say a bank transfer
16562 price/btc on localbitcoins if going through say paypal
11200 price/btc on coinmarketcap

I know paypal transactions are known to have high fees, but why?  and why such a huge jump like that? That is thousands of dollars in difference.
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LeGaulois
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January 17, 2018, 11:30:51 PM
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Because of the high risks of fraud from the buyers by opening a dispute, chargeback, and other nasty methods. Add the fact that Paypal doesn't allow activities related to digital currencies.

The risk has a price and the buyer is paying it

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January 17, 2018, 11:34:50 PM
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Even the coinmarketcap showing 11200 vs. the bank transfer on localbitcoins showing 12377 is over a 1,000 difference.
Well for the paypal:  It sounds so convenient and easy to just do a transaction that way. Less work, but I guess I should think more carefully about the price and risk factors involved and decide on another method. I so wish paypal was less risky and less expensive. : )

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January 18, 2018, 11:26:00 AM
 #4

Yes if you deal with a big amount the difference can be big (like +$1,000 while making a 1BTC deal in your example).
But when you think about it, it's just a 10% difference in the price. And of course, you can't expect to see people selling at the current price because, after all, they are there to make a profit Smiley

If it wasn't so easy to fraud with Paypal and people were more honest, it wouldn't be like this. Unfortunately, Paypal protects the buyers more than the sellers generally speaking.


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January 19, 2018, 07:07:53 AM
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Yes if you deal with a big amount the difference can be big (like +$1,000 while making a 1BTC deal in your example).
But when you think about it, it's just a 10% difference in the price. And of course, you can't expect to see people selling at the current price because, after all, they are there to make a profit Smiley

If it wasn't so easy to fraud with Paypal and people were more honest, it wouldn't be like this. Unfortunately, Paypal protects the buyers more than the sellers generally speaking.



Firstly, the risk of a chargeback when using Paypal to buy bitcoins is extremely high, I would say at least 20% of the time stolen/hacked Paypal accounts are used to purchase bitcoin, hence the vendor needs to increase their fees to cover the likelihood of a future chargeback.

Secondly, Paypal appear to be very much anti-crypto. If you open a dispute with Paypal after purchasing bitcoin, they will almost always side with the buyer, even though it is a digital item. Another problem for BTC sellers.

Lastly, Paypal has fees of over 3%, hence this needs to be added to the margin.

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suzanne5223
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January 19, 2018, 01:53:32 PM
 #6

Are these differences so that people can make a profit and incorporate fees that are involved?
Examples from localbitcoins

12377 price/btc on localbitcoins if going through say a bank transfer
16562 price/btc on localbitcoins if going through say paypal
11200 price/btc on coinmarketcap

I know paypal transactions are known to have high fees, but why?  and why such a huge jump like that? That is thousands of dollars in difference.

Localbitcoin work like a classified site where by you bid for a product or service and it good to always trade or buy bitcoin from user with good reputation score and high amount of trades on there. However, you can find the answer to any related question need to understand localbitcoin work on their faq link.

LeGaulois
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January 19, 2018, 05:38:24 PM
 #7

Yes if you deal with a big amount the difference can be big (like +$1,000 while making a 1BTC deal in your example).
But when you think about it, it's just a 10% difference in the price. And of course, you can't expect to see people selling at the current price because, after all, they are there to make a profit Smiley

If it wasn't so easy to fraud with Paypal and people were more honest, it wouldn't be like this. Unfortunately, Paypal protects the buyers more than the sellers generally speaking.



Firstly, the risk of a chargeback when using Paypal to buy bitcoins is extremely high, I would say at least 20% of the time stolen/hacked Paypal accounts are used to purchase bitcoin, hence the vendor needs to increase their fees to cover the likelihood of a future chargeback.



Have you read what I posted? It's exactly what I was explaining above, I don't need a parrot or an online spinner.

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