There are fewer options for peer-to-peer trading. If a well-known P2P exchange closes, it could be risky for us. Many people prefer P2P trading over centralized exchanges like Binance. While there might be other P2P exchanges opening up, LocalBitcoin was a trusted choice. I'm not sure why a P2P exchange would shut down. Maybe it's just for some temporary rules.
Localbitcoins shutdown probably due to regulatory pressure and a decline in its popularity/trading volumes, but it was far from being anything peer to peer and decentralized in its later stages.
The service was custodial and one need to have their KYC verified before using the exchange.
If you want a serious p2p exchange that is decentralized. Check out Bisq.network