Crypto exchange Paxful announced that it is shutting down due to regulatory challenges for the industry. The Founder and CEO, Ray Youssef made this statement in a message on the platform.
According to him,
Today, Paxful will be suspending its marketplace. We are not sure if it will come back.
This will probably come as a big shock to many. While I cannot share the full story now, I can say that we unfortunately have had some key staff departures. Also, regulatory challenges for the industry continue to grow, especially in the peer-to-peer market and most heavily in the U.S. While we work through these issues, we have taken the most secure option and ask you to explore self-custody and trade elsewhere.
Paxful is a peer-to-peer (P2P) cryptocurrency marketplace that allows users to buy and sell Bitcoin and other cryptocurrencies using various payment methods such as bank transfers, credit and debit cards, and even gift cards. The platform was founded in 2015 by Ray Youssef and is based in Delaware, USA. It is designed to provide a safe and secure platform for users to trade cryptocurrencies without the need for intermediaries such as banks or financial institutions. Paxful has gained popularity in many countries around the world, especially in regions with limited access to traditional banking services.
Youseff said that the Paxful wallet will be up for customers to retrieve their funds. He also added that the safety of customers’ funds was of utmost priority reassuring customers that all funds are all accounted for. He advised them to withdraw the funds and hold them personally. He recommends options such as Exodus Wallet and Muun Wallet.
Paxful says it is offering an easy migration to other options for non-U.S. users to platforms like Noones — a new P2P company dedicated to the Global South. “All the things you do on Paxful you can do on Noones, including:
- Lower trading fees
- One of the cheapest wallets
- An affiliate program even more generous than Paxful’s program
- A more efficient KYC process
- Local dispute moderators
- A much friendlier TOS policy with no accounts being locked
- I personally vouch for Noones, you can trust them
Bitnob — who makes it easy for Africans to connect with Bitcoin.
Aside from grappling with regulatory and personnel issues, Paxful is currently confronted with a legal suit filed by its former Chief Operating Officer and Co-founder, Artur Schaback. Schaback, who was ousted from the company more than a year ago, initiated the lawsuit against Paxful in January.
According to Youssef, “My co-founder sued the company and sued me. I have a lawsuit over my head right now.” He did not say more about this as this was now a court case.
As at 2022, the company stated that it had reached over 10 million users globally with Nigerians amounting to over 2 million users.
In 2021, Paxful opened the PaxNaija Education Center to empower Nigerians through Bitcoin education, hosted several campus tours and workshops to encourage entrepreneurship, and met with hundreds of community members to help increase financial literacy.
As part of Paxful’s mission to support emerging markets, Youssef also co-founded the Built With Bitcoin Foundation, a non-profit organisation dedicated to creating equal opportunities by providing clean water, access to quality education, sustainable farming and humanitarian support – all powered by Bitcoin. The foundation has constructed eight schools in Africa, including two in Kaduna State, Nigeria.
