{"investigation":{"slug":"local-traders","entity_name":"Local Traders","trust_score":22,"severity_base":null,"score_modifier":0,"confidence":0.52,"status":"published","content_type":"investigation","summary":"Local Traders (localtraders.finance) is a peer-to-peer cryptocurrency exchange and native token (LCT) project launched in 2021, headquartered in Chile and targeting Latin American and African markets. On May 23, 2023, the platform's smart contract was exploited due to a missing access-control check, resulting in approximately 379 BNB (~$119,000) stolen from its liquidity pool. The LCT token has since declined approximately 99.9% from its all-time high, the platform has shown limited trading volume, unverified team credentials, and a lack of regulatory registration, and the project was flagged by on-chain investigator ZachXBT.","sections":[{"content":"Local Traders (localtraders.finance) is a self-described peer-to-peer cryptocurrency trading platform that allows users to buy and sell Bitcoin (BTC), Tether (USDT), and USD Coin (USDC) across more than 750 payment methods in over 150 fiat currencies. The platform was founded by Abdul Rehman, a Pakistani national residing in Chile, and positioned as the 'First LATAM-Based Tokenized P2P Exchange.' The project launched its whitepaper in March 2021, entered testnet in June 2021, and went live on mainnet in September 2021. Its native utility token, LCT (Local Traders Coin), was deployed on the Binance Smart Chain (BEP-20 standard) with a maximum supply of 300,000,000 tokens. The platform has since expanded its marketing to West African markets including Ghana and Nigeria, where it is promoted as a zero-fee P2P solution following Binance's withdrawal of naira P2P trading services.","heading":"Platform Overview","sources":[{"url":"https://www.localtraders.finance/","name":"Local Traders Official Website","type":"official","credibility":2},{"url":"https://ico.coincheckup.com/local-traders/","name":"Local Traders ICO Details - CoinCheckup","type":"research","credibility":2},{"url":"https://icoholder.com/en/local-traders-1035380","name":"Local Traders ICO Rating and Details - ICOholder","type":"research","credibility":2},{"url":"https://www.vanguardngr.com/2025/05/local-traders-best-p2p-crypto-trading-platforms-in-nigeria/","name":"Local Traders: Best P2P Crypto Trading Platforms in Nigeria - Vanguard News","type":"news_article","credibility":2}],"severity":"low"},{"content":"On May 23, 2023, Local Traders suffered a critical smart contract exploit on the BNB Chain resulting in the theft of approximately 379.32 BNB, valued at roughly $119,040 at the time. The root cause was a missing access-control check in smart contract function 0xb5863c10, which allowed any external caller to reassign contract ownership without authorization. The attacker exploited this flaw by first calling the unprotected function to transfer ownership of the contract to their own address, then invoking the getTokenPrice function to purchase LCT tokens at an artificially depressed price, and finally selling those tokens at market price for profit. The attacker's address (0xd771dfa8fa59bd2d1251a0481fca0cf216276dd7) held the stolen funds, which were subsequently blacklisted by exchanges. The Local Traders team acknowledged the breach, announced a recovery plan involving four buyback tranches of 100 BNB each, and stated they attempted to contact the attacker through a bug bounty settlement offer. This exploit occurred despite the project having obtained a security audit from Solid Proof and holding a CertiK Skynet Score of 72.07 at the time of the incident, demonstrating that third-party audits did not prevent the vulnerability.","heading":"Smart Contract Exploit (May 2023)","sources":[{"url":"https://medium.com/neptune-mutual/understanding-local-traders-exploit-d5e1f373b10f","name":"Understanding Local Traders Exploit - Neptune Mutual on Medium","type":"research","credibility":2},{"url":"https://smartcontractshacking.com/hacks/local-traders-hack-2023","name":"Local Traders Hack (2023) — $118K Lost | Smart Contract Hacking","type":"research","credibility":2},{"url":"https://bscscan.com/address/0x5c65badf7f97345b7b92776b22255c973234efe7","name":"Local Traders: LCT Token Contract - BscScan","type":"on_chain","credibility":1}],"severity":"critical"},{"content":"The LCT token conducted an ICO on October 19-22, 2022, at a price of approximately $0.001945 per token on the Binance Smart Chain, with a soft cap of 40 BNB and 105 million tokens made available. The token reached an all-time high of approximately $0.392085 on October 3, 2023, before experiencing a collapse of approximately 99.9% to trade at around $0.000363 as of May 2026. The 24-hour trading volume has fallen to negligible levels — reported at $0.16 in some tracking data — and on-chain liquidity on PancakeSwap V2 (BSC) has been minimal. With 4,276 holders against a maximum supply of 300 million tokens and nearly zero trading volume, the token exhibits characteristics consistent with a failed or abandoned project. The dramatic price decline following the May 2023 exploit, combined with near-zero liquidity and volume, raises concerns about the long-term viability and financial integrity of the project's tokenomics.","heading":"LCT Token Performance and Market Concerns","sources":[{"url":"https://coinpaprika.com/coin/lct-local-traders/","name":"LOCAL TRADERS (LCT) Price - CoinPaprika","type":"research","credibility":2},{"url":"https://coinmarketcap.com/currencies/local-traders/","name":"Local Traders price today, LCT to USD - CoinMarketCap","type":"research","credibility":2},{"url":"https://bscscan.com/token/0x5c65badf7f97345b7b92776b22255c973234efe7","name":"Local Traders: LCT Token | BscScan","type":"on_chain","credibility":1},{"url":"https://ico.coincheckup.com/local-traders/","name":"Local Traders ICO Details - CoinCheckup","type":"research","credibility":2}],"severity":"high"},{"content":"All team members listed on ICOholder for Local Traders are marked as 'unverified,' with the site explicitly noting that 'unverified members are not actually members of the team.' The AMA conducted by the project and recapped by Crypto Players Media revealed that founder Abdul Rehman provided vague answers about team composition, redirected questions about credentials to the whitepaper, and did not name specific team members beyond a general description of 'lawyers, UI/UX designer, Dev, researcher, marketing professional and cyber analyst.' CoinCheckup's ICO listing returned an 'N/A' review score. ICOholder's listing similarly lacks any verified team profiles or fundraising transparency data. The CertiK audit from October 2022 identified one major 'Centralization / Privilege' issue — a finding that is particularly salient given that the subsequent May 2023 exploit involved precisely this type of access-control vulnerability. The combination of unverifiable team identities, vague public disclosures, and the presence of centralization risks in the audited contract represents material transparency concerns.","heading":"Team Transparency and Verification Concerns","sources":[{"url":"https://icoholder.com/en/local-traders-1035380","name":"Local Traders ICO Rating, Reviews and Details - ICOholder","type":"research","credibility":2},{"url":"https://cryptoplayers.medium.com/ama-recap-local-traders-43387434fa88","name":"AMA Recap — Local Traders - Crypto Players on Medium","type":"community_report","credibility":3},{"url":"https://skynet.certik.com/projects/local-traders","name":"Local Traders - CertiK Security Leaderboard","type":"research","credibility":2}],"severity":"high"},{"content":"Local Traders has no verifiable registration with any major financial regulatory authority. The platform is headquartered in Chile, which enacted a comprehensive Fintech Law (Law No. 21.521) in 2023 requiring crypto-asset platforms to register with Chile's Financial Market Commission (CMF) and obtain operating authorization — a process that includes solvency, governance, cybersecurity, and client-asset segregation reviews. No evidence has been found of Local Traders having obtained or applied for this registration. The BrokerChooser safety assessment for the closely related 'Local Trader' entity notes that the platform is 'not regulated by any major regulatory authority, such as the Financial Conduct Authority.' Without verified regulatory registration, users who experience fund loss or disputes have limited or no legal recourse through established financial regulators. The platform's expansion into Nigeria and Ghana — both markets with evolving but not yet comprehensive crypto regulatory frameworks — further limits consumer protection options for users in those markets.","heading":"Regulatory Status","sources":[{"url":"https://brokerchooser.com/safety/local-trader-broker-safe-or-scam","name":"Is Local Trader safe or a scam? - BrokerChooser","type":"research","credibility":2},{"url":"https://www.ainvest.com/news/chile-introduces-comprehensive-crypto-framework-2023-fintech-law-2506/","name":"Chile Introduces Comprehensive Crypto Framework With 2023 Fintech Law","type":"news_article","credibility":2},{"url":"https://hackenproof.com/blog/for-business/crypto-regulations-latin-america-2025-2026","name":"Crypto Regulations in Latin America 2025 - HackenProof","type":"research","credibility":2}],"severity":"high"},{"content":"On-chain investigator ZachXBT flagged Local Traders as a risky entity, which is the basis for this AVOID.NET investigation. While the precise content and date of ZachXBT's specific post about Local Traders could not be independently verified via publicly indexed sources at the time of this investigation, ZachXBT's broader investigative work has documented that a minimum of $44 million was laundered through P2P exchanges (including Paxful and Noones) by threat actors, and has previously flagged P2P platforms used as money-laundering vectors. The May 2023 smart contract exploit documented by multiple independent security researchers (Neptune Mutual, Smart Contract Hacking database) corroborates that the platform suffered a significant, publicly documented security failure. Additionally, the Local Traders Telegram channel (t.me/Localtraderscl) confirmed a hacker 'successfully steal funds from the pool' via smart contract vulnerability, consistent with on-chain reporting. Community sentiment reflected in Trustpilot reviews noted concerns including withdrawal difficulties and account lockouts. These signals, in aggregate, are consistent with the pattern of risk entities flagged by ZachXBT in his investigative work.","heading":"ZachXBT Flag and Community Risk Signals","sources":[{"url":"https://en.wikipedia.org/wiki/ZachXBT","name":"ZachXBT - Wikipedia","type":"other","credibility":2},{"url":"https://www.trmlabs.com/resources/blog/zachxbt-uncovers-crypto-theft-network-linked-to-us-government-seizure-funds","name":"ZachXBT Uncovers Crypto Theft Network Linked to US Government Seizure Funds - TRM Labs","type":"research","credibility":2},{"url":"https://www.trustpilot.com/review/localtraders.finance","name":"LOCAL TRADERS Reviews - Trustpilot","type":"community_report","credibility":3},{"url":"https://t.me/s/Localtraderscl","name":"Local Traders Channel [OFFICIAL] - Telegram","type":"social_media","credibility":3}],"severity":"high"},{"content":"Local Traders obtained a security audit from CertiK in October 2022, receiving a Skynet Trust Score of 72.07 (BBB rating). The audit identified one major finding related to 'Centralization / Privilege,' which was reportedly resolved. The project also claimed a Solid Proof audit. Despite these third-party security reviews, the May 2023 exploit successfully drained approximately $119,000 from the smart contract via an access-control vulnerability — precisely the category of risk flagged in the CertiK audit under 'Centralization / Privilege.' This outcome illustrates that the resolution of audited findings was either incomplete or introduced a new variant of the same vulnerability class. The formal verification component of the CertiK audit (76/76 properties passed) did not prevent the exploit, suggesting the audited scope did not cover the specific vulnerable function. Post-exploit, the team established a bug bounty program via HackenProof with rewards up to $20,000 and committed to rebuilding the staking pool with the swap function disabled.","heading":"Security Audit History","sources":[{"url":"https://skynet.certik.com/projects/local-traders","name":"Local Traders - CertiK Skynet Project Insight","type":"research","credibility":2},{"url":"https://medium.com/neptune-mutual/understanding-local-traders-exploit-d5e1f373b10f","name":"Understanding Local Traders Exploit - Neptune Mutual","type":"research","credibility":2}],"severity":"medium"}],"timeline":[{"date":"2021-03","event":"Local Traders whitepaper released; project announced as first LATAM-based tokenized P2P exchange","source":"CoinCheckup ICO listing","source_url":"https://ico.coincheckup.com/local-traders/"},{"date":"2021-06","event":"Local Traders testnet launched","source":"CoinPaprika token timeline","source_url":"https://coinpaprika.com/coin/lct-local-traders/"},{"date":"2021-09","event":"Local Traders mainnet launched; LCT token distribution begins","source":"CoinPaprika token timeline","source_url":"https://coinpaprika.com/coin/lct-local-traders/"},{"date":"2022-10-19","event":"LCT token ICO conducted on Binance Smart Chain at $0.001945 per token; soft cap of 40 BNB","source":"CoinCheckup ICO listing","source_url":"https://ico.coincheckup.com/local-traders/"},{"date":"2022-10-30","event":"CertiK security audit completed; one major Centralization/Privilege finding identified and reportedly resolved; Skynet score 72.07","source":"CertiK Skynet Project Insight","source_url":"https://skynet.certik.com/projects/local-traders"},{"date":"2023-05-23","event":"Smart contract exploit on BNB Chain drains approximately 379.32 BNB (~$119,040) via missing access-control check in function 0xb5863c10; attacker address 0xd771dfa8fa59bd2d1251a0481fca0cf216276dd7","source":"Neptune Mutual exploit analysis","source_url":"https://medium.com/neptune-mutual/understanding-local-traders-exploit-d5e1f373b10f"},{"date":"2023-05-24","event":"Local Traders team publicly acknowledges exploit; announces four-tranche 100 BNB buyback recovery plan and bug bounty via HackenProof","source":"Local Traders Official Telegram Channel","source_url":"https://t.me/s/Localtraderscl"},{"date":"2023-10-03","event":"LCT token reaches all-time high of approximately $0.392085 before subsequent collapse","source":"CoinPaprika","source_url":"https://coinpaprika.com/coin/lct-local-traders/"},{"date":"2025-05","event":"Local Traders featured in sponsored articles on Vanguard Nigeria and Citi Newsroom Ghana promoting platform as best P2P option following Binance P2P withdrawal from African markets","source":"Vanguard News Nigeria","source_url":"https://www.vanguardngr.com/2025/05/local-traders-best-p2p-crypto-trading-platforms-in-nigeria/"},{"date":"2026-05","event":"LCT token trading at approximately $0.000363 — approximately 99.9% below all-time high — with 24-hour volume of under $1 on tracked exchanges","source":"CoinPaprika","source_url":"https://coinpaprika.com/coin/lct-local-traders/"}],"sources_used":[{"url":"https://www.localtraders.finance/","name":"Local Traders Official Website","type":"official","archive_url":"http://web.archive.org/web/20260602222834/https://localtraders.finance/","credibility":2,"archive_timestamp":"2026-06-02T22:28:34+00:00"},{"url":"https://medium.com/neptune-mutual/understanding-local-traders-exploit-d5e1f373b10f","name":"Understanding Local Traders Exploit - 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