LocalBitcoins had to close because of government rules and not many people using it anymore. But it wasn't really peer-to-peer or decentralized like it claimed to be. You had to give your personal info before using it, and it held onto your bitcoins for you.
Exactly and this is the same lie Binance, Bybit, Kucoin and all this other centralized exchanges are selling to users claiming that they have p2p service, yet the fact is that for you to use the service;
1. You have to pass KYC verification
2. You let them be the custodians of the funds
Hardly peer to peer in my opinion.