Paxful, a cryptocurrency exchange that’s been based in the United States and had a significant presence in Africa, has ceased operations.
The company’s chief executive officer, Ray Youseff, stated that the closure was due to an unfavourable regulatory landscape.
The company has requested that its customers remove their funds from the platform immediately.
The Chief Executive Officer of Paxful, Ray Youssef, stated on a Twitter space that the decision to shut down the company was made because there were no more engineers, members of the compliance team, or security personnel working for the company.
In addition, he stated in a post that was published on his blog that “regulatory challenges for the industry continue to grow, especially in the peer-to-peer market and most heavily in the U. S.”
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Why Paxful is Shutting Down
Paxful is the most recent cryptocurrency exchange to cease business operations since the onset of the crypto winter in 2022. It is safe to say that the entire cryptocurrency ecosystem has been through a lot, from the collapse of Terra Luna, which caused $60 billion in value to be wiped off the market, to the shocking conclusion of FTX’s operation.
In addition to the ongoing crypto winter, regulators are tightening their grip on cryptocurrency startups. Youssef is of the opinion that despite the fact that regulators may be making some headway in regard to cryptocurrencies, “they still don’t get it.” He also mentioned that they are getting more and more suspicious of cryptocurrency startups.
The Commodity Futures Trading Commission is currently engaged in a legal battle with the cryptocurrency exchange Binance, which is the largest cryptocurrency exchange in the world (CFTC). The commission brought charges against the exchange and its chief executive officer, Changpeng Zhao, accusing them of willfully evading federal law and operating an illegal digital asset derivatives exchange.
Paxful enjoyed a significant presence across the African continent. Similarweb reports that the country of Cameroon has the second highest number of visitors to its website regarding the stock market that is based in New York.
Nigeria, however, is the largest market for the New York-based exchange, with 1.5 million users and $1.5 billion worth of Bitcoin trades in 2021. In 2021, the country was headquartered in New York.
Issues in Paxful
Paxful is currently dealing with a number of issues, including regulatory issues and personnel issues. In addition, the company is being sued by Artur Schaback, who was the company’s co-founder and former Chief Operating Officer.
After being fired from his position at the company more than a year ago, Schaback initiated legal action against the business in January.
Youssef was quoted as saying something to the effect that “My co-founder sued the company and sued me. .”
He confirmed that the lawsuit was one of the reasons the company was short on staff, saying that they “just couldn’t deal with this guy anymore.” Despite the fact that he was unable to provide additional information on the lawsuit because Paxful is only a nominal defendant in the litigation, he did confirm that the lawsuit was one of the reasons for the lawsuit.
Paxful has been in business for seven years and three months, but the company has decided to close down. Youssef strongly encourages customers to take out their money as soon as they are able to.