P2P bitcoin exchange Paxful is closing its marketplace, citing legal difficulties in the P2P market and in the US. The CEO also expressed concern about the security of client money due to a lawsuit brought by a co-founder. The Paxful Wallet will continue to function, but customers are urged to switch to self-custody or other service providers.
Peer-to-peer (P2P) bitcoin exchange Paxful has revealed that it is closing its marketplace. The cryptocurrency exchange cites legal difficulties in the P2P market and in the United States as some of the factors for this decision. The business said it is uncertain as to whether activities will restart in a statement from CEO Ray Youssef posted on its website. This latest development comes after Paxful suspended the trading of ether on its marketplace in December 2022.
Youssef noted that the business had encountered legal difficulties while attempting to adhere to the greatest standards over the previous five years. Although the business has made an attempt to conform, authorities have not been helpful. Youssef called the circumstance “painful to see” and listed it as one of the causes for the company's decision to stop offering its services.
In addition to regulation issues, Youssef expressed worry about the security of client money as a result of a case brought by Paxful co-founder Artur Schaback. Schaback's lawsuit team, according to the CEO, was “really nasty” and drove away all of the company's senior-level employees. Additionally, Schaback declined to pay the company's programmers and safety team, leaving Youssef unable to ensure the platform's security.
Despite the halt of its platform, the Paxful Wallet will continue to function, enabling users to access their money. Customers were also urged to switch to self-custody or use other service suppliers.
Youssef also mentioned that the company had experienced some key staff departures in recent months. While he couldn't share the full story, he acknowledged that the departures had played a role in the suspension of the marketplace.
The Paxful marketplace's closure is a serious setback for the Bitcoin market. The action emphasizes the difficulties P2P marketplaces encounter when it comes to client security and regulatory conformance. Other P2P marketplaces are likely to encounter comparable difficulties in the near future as authorities increase their monitoring of the sector.
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