P2P marketplace Paxful cites regulatory pressure as it suspends …

Digital wallet and P2P marketplace provider Paxful will be suspending operations effective immediately. “We are not sure if it will come back,” said CEO Ray Youssef in a blog post earlier this week. He cited increasing “regulatory challenges” as the main reason for the closure. However, the continuing fallout from the Celsius bankruptcy and an ongoing legal dispute between Paxful’s co-founders likely also played a part.

Paxful always aimed itself squarely at “underserved” markets both in wealthy countries and increasingly in the “Global South,” trading between parties with a wide range of other payment options and assets–most notably gift cards. It also operated a marketplace where users could list items for sale for payments in digital currency. The company’s gift card market was famous in places where bank accounts are not universal, and Paxful had pushed into African markets like Nigeria.

They were also used in the West, where certain people have been banned from payment providers or blocked from making payments to certain businesses/industries for various legal and political reasons. Though regulations were increasing the pressure for digital currency businesses worldwide, they were affecting P2P markets “most heavily in the U.S.,” Youssef wrote. He later added in a Twitter Spaces group that U.S. regulators had been initially slow to move in the digital asset space but had “done a great job catching up” in recent years.

Youssef, originally from Egypt but raised in New York City, is a well-known commentator and social media figure in the digital asset community. He pledged not to withdraw funds from his personal wallet until all customers had done so first:

I’m not withdrawing my btc from @paxful until everyone else gets theirs out first ? pic.twitter.com/v0hq62SQaB — Ray Youssef (@raypaxful) April 5, 2023

“We’re not in skyscrapers with “the suits”–we’re on the streets with the people,” the company’s website says.

Youssef added that, over time, regulations had forced about a quarter of his staff to concentrate on compliance issues. While one option would have been to block U.S. customers from using Paxful, this didn’t make any sense business-wise. Paxful had also seen problems following the Celsius Network bankruptcy, where its users found their funds from the Celsius Earn program locked and ruled by a judge to belong to Celsius, not depositors.

As a customer service gesture, Paxful promised to refund any amounts lost to Celsius Earn from its own reserves. Since January 2023, the company has been in a legal dispute between current executives and original co-founder Artur Schabak. Though the complaint, filed in Delaware, was over an alleged breach of fiduciary duty, details of the dispute remain sealed and confidential.

In happier times, Schabak and Youssef were arrested in Miami in 2016 on drugs and weapons allegations following a wild party at an apartment in the city. Charges against them were dismissed later that year. Digital asset businesses, particularly those sticking to old-school “crypto” principles of anarcho-capitalism and freedom through less-traceable payments, face ever-increasing heat from financial regulators.

Though Paxful and similar services are not accused of doing anything illegal, the nature of P2P marketplaces that allow free exchange of value (again, such as combinations of digital assets and anonymous gift cards) make them among the first in line for scrutiny. More and more, the blockchain/digital asset industry is growing to mirror the traditional financial industry, with all its restrictions and red flags for consumer protection and money laundering regulators. Exchanges are facing increasing pressure to monitor their users’ activities both within and outside the platforms they use, with demands they register identities behind external wallet addresses and pay closer attention to transfers of stablecoins like USDC and Tether.

Watch: The Future World with Blockchain

width=”200″ height=”112″ frameborder=”0″ allowfullscreen=”allowfullscreen”>

New to Bitcoin?

Check out CoinGeek’s Bitcoin for Beginners section, the ultimate resource guide to learn more about Bitcoin–as originally envisioned by Satoshi Nakamoto–and blockchain.

Tags:

aybl listed on couponmatrix.ukeqvvs listed on couponmatrix.ukgear4music listed on couponmatrix.ukpercival listed on couponmatrix.ukrock-n-rose listed on couponmatrix.ukyoins listed on couponmatrix.uk
aybl listed on couponmatrix.ukThe AYBL collection is packed with comfortable basics and bold splashes of colour to motivate your fitness journey. Whether you’re a runner, yogi or gym enthusiast, you can’t go wrong with stretchy AYBL leggings to move your body more freely or a premium-quality sports bra for your workouts. AYBL gym wear hits the sweet spot between quality and affordability, especially when you use an AYBL discount code from Groupon. Thanks to student discounts, AYBL Rewards and amazing sales, AYBL remains the best place to revive your activewear wardrobe on a budget.
eqvvs listed on couponmatrix.ukIf youre a big fan of the high street but fancy heading upmarket then you've found the perfect solution with EQVVS, the clothing company bringing men near and far designer fashion at great prices! With a EQVVS discount code from us you can expect to make incredible savings across these ranges of smart wear and casual looks from big names like Versace, Paul Smith and Armani to name but a few.
gear4music listed on couponmatrix.ukIf music is food for the soul, then Gear4Music is an all-you-can-eat buffet. As specialists in supplying instruments from every walk of the musical world, Gear4Music offer an unparalleled inventory of electric, acoustic and classical instruments at unbeatable prices. Thrifty shoppers should keep a Gear4Music discount code close whenever they need to upgrade their setup, as they can expect to save double digits on an array of top quality amps, soundboards, DJ decks and microphones.
percival listed on couponmatrix.ukPercival menswear is for those who appreciate the beauty of simple yet exceptional design. Breathing life back into the old British style, Percvial offers modern reinterpretations of timeless wardrobe staples like the classic trench coat, overshirt and cardigan, alongside exciting collaborations with brands like Champion and Umbro. You’ll always be the best-dressed in the room when you use a Percival discount code from Groupon, so make this Hackney-based style icon your go-to for men’s fashion.
rock-n-rose listed on couponmatrix.ukWelcome to Rock N Rose, the go-to destination for fashion-forward women who want to look and feel their best. Rock N Rose offer a wide variety of clothing, accessories and beauty products to suit every taste. And to help you get even more value out of your purchase, we offer Rock N Rose discount codes that you can use on your next order. So whether you're shopping for a new outfit for a special occasion or just stocking up on everyday essentials, be sure to take advantage of our Rock N Rose discount code and save! At Groupon, we know that saving money is important to our customers. That's why we work hard to find the best Rock N Rose discount codes and deals, so you can get the items you want at a price that fits your budget. We're constantly searching for new offers and updating our site with the latest discounts, so be sure to check back often and take advantage of our Rock N Rose discount code while it lasts! If you're looking for a new fashion-forward wardrobe addition, we highly recommend checking out Rock N Rose. They offer a wide variety of stylish clothing, accessories and beauty products that will suit any taste. Plus, with our Rock N Rose discount, you can get even more value for your purchase. So whether you're shopping for a special occasion or just stocking up on everyday essentials, be sure to take advantage of our Rock N Rose discount and save!
yoins listed on couponmatrix.ukAre you looking to revamp your wardrobe in the latest styles without using up all your savings? Then look no further than Yoins who have the lowdown on cutting edge fashion for your pleasure! With a Yoins discount code on us you’ll be dying to get your hands on these dresses, sweaters, shoes and more. Check out the ‘New In’ section to see what’s fresh off the runway or the sale to see what you can get for less.