LocalBitcoins is a great marketplace for P2P bitcoin trading. If one is lucky enough to be located in a country where such trading activity is not illegal and one is conscious of associated risks it can be an easy stream of revenue. Like any other business model it does require some processes to be followed. This is where Bitnik Reload comes into the picture. It allows automation and mitigates effects of price volatility.

Bitnik Reload is an easy-to-use web service that provides much needed automation and reporting to a LocalBitcoins reseller (or any similar OTC — Over-The-Counter reseller). It rebuys bitcoins ‘on-the-fly’ as they are sold through trader’s LocalBitcoins account.

LocalBitcoins seller can run his business by buying a certain stock of bitcoins and once those are sold, he rebuys more, to bring stock back to starting level. On LocalBitcoins the price is determined based on market price at the time of sell transaction. As bitcoin is quite volatile this leaves bitcoin reseller very open to price volatility swings. In some cases he will make even more profit as he will re-stock at lower market prices and in some cases there will be less profit (or even a negative one). In the long run things should level out, but is this really the best way to do this business? Of course not!

The proper way to do this is to rebuy a bitcoin whenever bitcoin is sold. The ‘restocking period’ should basically be shortened to happen with every sale. In parallel with bitcoin sale on LocalBitcoins, the same amount of bitcoins should be rebought on exchange. This almost eliminates the price volatility effect and ensures consistent and predictable profits.