Man robbed of $28K during bitcoin sale in Florida

Often times you hear the best way to preserve your anonymity in bitcoin is to do a person-to-person (P2P) transaction. However, after reading this story some may think twice about P2P sales in the future.

In Boynton Beach Florida, a man named Steve Manos setup a P2P sale of $28,000 USD for the purchase of bitcoin. Manos, who has done bitcoin sales in the past with the two alleged suspects, setup the deal which took place around midnight in the parking lot of a West Palm Beach Boston Market.

The value at the time of this writing for $28,000 USD converted to bitcoin is 46.68 BTC. During the transaction with the suspects which took place in Manos’ car in the restaurant parking lot, he handed over the $28,000 to one of the suspects in exchange for the bitcoin. The suspect sitting in the front seat according to the Palm Beach Sherriff’s office then took out his laptop to finish the transaction, but also pulled out a knife and pressed it against Manos’ chest. Manos told the suspects to leave but the other suspect, who was sitting in the back seat behind Manos, tussled with him in an attempt to take Manos’ gun which was located in his driver-side door compartment.

According to the report, the two robbers ran away with the money. Manos chased them, but couldn’t keep up. The suspects got into a Acura, and sped off. Manos knowing the suspects and having their phone number, provided it to police who arrested one of the suspects the next day who is now facing armed robbery, burglary, and battery charges.

How to stay safe during P2P sales

It’s unclear how the sale came about in this case, whether the persons were using LocalBitcoins or some other means to work with each other to initiate the sale. Whatever the case, if you are using a P2P marketplace such as LocalBitcoins, Mycelium Trader, or Paxful, make sure you do your homework first on the persons you are dealing with.

Check their reputation, history, and see if there are any red flags. If anything sticks out, it’s not worth the risk. A common practice of scammers, and worse armed robbers, is to use fake accounts to create a fake transaction sale history with good reputation on their profiles. This means doing research prior to any sale to make sure everything seems legit.

Outside of that, the most important things when doing a P2P sale is to do it in public and during the day, preferably with other people you know with you. Use the buddy system, and as with the case above, never do sales at night in a parking lot with nobody around.

Safe places to transact during the day would be places such as Starbucks, inside a restaurant or shopping mall, or some people have even used banks to transact. Some banks who are bitcoin-friendly, if you call them in advance will let you transact in a back room where there is much higher levels of security (and cameras).

The key thing is to always trust your instinct. If the deals are too good to be true, that is another indicator that something is amiss.

P2P markets have advantages and disadvantages

With P2P sales, a major advantage is that you are keeping your identity more private than you would be using a bitcoin exchange. Although online exchanges are much more convenient, you lose your privacy when you have to follow compliance rules such as KYC/AML. With a P2P sale, there is no record made officially within any database and often times the transactions are cash sales.

The disadvantages for P2P sales outside of the risk factor is the price. Prices on P2P marketplace sites such as LocalBitcoins cost a lot more, as you are paying for privacy and the transactions are higher risk. For example, we keep track of the LocalBitcoins price, which if you compare against other USD exchange prices, it’s always higher than the rest.