Paxful, once billed as the world’s largest people-powered crypto marketplace, will cease operations by November 1, 2025, closing a 10-year chapter that helped mainstream peer-to-peer (P2P) trading across Africa and beyond. In a statement, the company said the decision follows the lasting impact of historic misconduct by former co-founders Ray Youssef and Artur Schaback prior to 2023, alongside unsustainable compliance remediation costs—adding that the move is strategic, not a sign of insolvency or issues with current leadership. Paxful says it will keep communications open and return all user funds, urging customers to withdraw balances promptly.
The wind-down caps a turbulent period that began when Paxful suspended operations in April 2023 amid co-founder disputes, governance turmoil, and loss of key staff. The marketplace later resumed service under new leadership and a court-supervised turnaround, highlighting renewed focus on safety and compliance.
Legal aftershocks kept rippling. In July 2024, U.S. authorities announced that Artur Schaback pled guilty to conspiring to willfully fail to maintain an effective anti-money-laundering (AML) program under the Bank Secrecy Act, and he resigned from Paxful’s board. That case reinforced the scale of compliance repairs Paxful needed to undertake—repairs the company now says ultimately made long-term operations uneconomical.
Even so, Paxful stresses the closure is orderly. The firm’s dedicated wind-down page outlines timelines and withdrawal instructions, reiterating that the business remains financially stable while it exits. The public announcement has been echoed across Paxful’s social channels and covered by crypto and tech media tracking the platform’s long influence on P2P markets, particularly in Africa.
Why Paxful’s exit matters
1) A P2P pioneer bows out. Founded in 2015, Paxful connected 14 million+ users in 140+ countries, offering hundreds of payment rails to buy and sell bitcoin and stablecoins—often acting as a financial on-ramp where formal rails were constrained. Its role was especially visible in Nigeria and East Africa, where P2P became a workaround during banking restrictions on crypto.
2) Compliance is now the moat. The company’s explanation—legacy misconduct plus rising remediation costs—underscores a broader trend: crypto platforms that scaled fast in the 2017–2021 era are now reinventing (or retreating) under tougher AML/KYC expectations. Schaback’s plea illustrates the legal exposure when AML programs lag product growth.
3) Users need a migration plan. Paxful says withdrawals remain open throughout the wind-down and that communications will continue. Users should verify official links, withdraw funds, and export transaction histories for tax and record-keeping. (Always access Paxful pages via direct bookmarks or the official site to avoid phishing.)
4) Market realignment. With Paxful exiting, liquidity and network effects will redistribute to regional and global P2P venues, OTC desks, and compliant on-ramps. In markets like Nigeria—where Paxful was long a household name—expect short-term friction as traders shift order flow, followed by consolidation around players that can pair user experience with industrial-grade compliance. Coverage from industry outlets suggests this transition is already underway.
Paxful’s management thanked its community and framed the decision as closing with integrity rather than grinding forward in a structurally higher-cost regime. For users, the practical next steps are simple: log in, withdraw, and archive your records. For the P2P industry, the message is sharper: the next decade will belong to platforms that treat compliance not as a patch—but as core infrastructure.
