Topic: Paxful is shutting down (Read 418 times)

I'm thinking right now those people that have seen posting in many forums that they've got funds remaining on the closed exchanges. And with this, if someone who's an active user of paxful before and haven't used it for quite a while and isn't a regular checker of his emails, socials and updates then they might just miss this update and closure and the funds won't be retrieved anymore. I'm sure that this is quite rare but it do happened for some before. Just as looking at the update on their status page, well, there's still the maintenance towards its wallets. By the way, is the CEO has strong connections with the other companies he has mentioned?

I don't do crypto to crypto day trading, I am only doing crypto to fiat and vice versa.

So, I am concerned about withdrawing fiat which is different from p2p, ofcourse we can use Binance p2p but the offers are low and also the tranders are known or atleast under the radar of cryptocurrency activities via their bank account which I certainly want to avoid because I remember your funds in bank account can be frozen because the trader you conducted a trade has a connection with funds received from a hacked bank account.

What do you mean by that? It's not really any different than Paxful or LBC.

I'm not sure if I understood you correctly, but when you deposit, you can deposit directly to the Funding wallet (the one used for P2P trading) and when withdrawing, you should be able to withdraw from either (Spot/funding). You're not required to move funds between accounts and then withdraw.

Binance is a good choice but I don't prefer centralized exchange's p2p because when we cash out from the platform the funds will be deposited via exchange which I don't prefer for some reasons but I want to state that cryptocurrency is not banned and Binance also available. When it comes to p2p I still prefer the traditional p2p exchange whether it needs kyc or not because I am comfortable with KYC and I do trade for big amounts so certainly I have to atleast do ID verification to get decent limit.

If you don't care about KYC, then Binance is a good alternative and it doesn't have any fees.

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Update: it looks like the status page was reporting accurate data at the time I posted this:

The news is shocking to me as well because those two P2P which are LBC and Paxful operated for years now shutting down one by one, for me it's still hard to find the alternative after LBC since I used to be a day trader. So what are there real alternatives now?

I know that Bisq is true P2P but as I said before still the volume for my fiat is zero so hopefully I can see some volume here after. The P2P offered by Binance and other centralised exchange is the real reason behind the shutting down of LBC and Paxful!!!

You can transfer the fiat using any of the usual electronic methods or via cash.

How do they know you have any coins? If you've done things properly, then you've traded exclusively peer to peer, you've not signed up to any centralized exchange or other centralized service, and you've not handed your KYC over to any third parties.

Ok but do I understand correctly that when I want to acquire Bitcoin with fiat via Bisq that Bisq only handles the Bitcoin transfer while I have to use the traditional banking system to wire the fiat money? Once financial authorities get involved asking me for the origin of my coins, I would have to tell them anyway with whom I transacted. It is still better than doing it directly via a centralized exchange, but a result could be that they do get the data they want either way. The problem is that the governments are trying to cause trouble for you if you can't properly prove the origin of funds. I am not a fan as you can imagine of what might be coming our ways in Europe. I hope it is not going to happen the way they wanted it to happen like a year ago or so. So far it is still all cool, but one reason for that might be that people do actually pay their taxes. If they weren't, there would be more incentive for authorities to crack down (besides their hunger for limitless data).

I read through this news yesterday, and this move made by the CEO of Paxful, to me, is the best decision anyone who has the interest of its customers at heart should do, after a proper analysis of the whole matter, what the company is going through, the attack from competitors, the indirect attack from the US, etc. It's better for them to shut down like they just did, giving every user the right to withdraw their funds to a safer place. They even advise users to be careful about which platform they choose to use next. 

Assuming the CEO is blind to things happening in the exchange, we could have woken up one day to hear that another exchange has filed for bankruptcy. So I will advise users to safely go and withdraw their funds now that the server is still open before another negative announcement is made. 

So was I, until several years ago when they transitioned to demanding KYC from all their users as Solosanz has provided links for above. At that point I immediately stopped using them and transitioned to better options. Now I use mostly Bisq, but a handful of other platforms too.

After the FTX collapse, i think more and more users will realize that the CEXs risk due to security and not transparency.

In addition,many CEXs including Binance,Coinbase,etc. faces possibly its strongest regulatory pressure yet, with centralized exchanges feeling the brunt of it so far. The U.S. Securities and Exchange Commission went after Kraken for its staking service, and issued a Wells Notice to Coinbase, while the Commodity Futures Trading Commission accused Binance of evading U.S. law.

So that crypto traders will shift to decentralized exchanges(DEX)s or transparency exchanges(TEXs) ,for the decentralized exchanges(DEX)s,it is more transparent and safe, but have the issues such as high threshold and complicated operation.For the transparency exchanges(TEXs),which find a balance between transparency and user experience, ensuring transparency and security, there is no need to sacrifice user experience.

Localbitcoins used to be no KYC P2P platform, but now isn't not anymore. I think you're talk about few years ago and it's already a lot change of less KYC centralized exchange, turn out become KYC exchange.

In 2019, you can use LBC with T0 tier which consist of your full name, country of residence, email address and phone number, with limit 1,000 Euros/year.

But now there's no T0 anymore, the minimum is T1 tier where you need to submit your physical address check, ID verification and KYC info.

I was trading heavily on localbitcoins for years, in person trades and money transfer services and I never had to fill out any KYC forms. Never sent in ID, or any identifying information outside of a phone number that I used to talk to buyers and sellers. Not sure why you feel there was no privacy? Localbitcoins staff having Access to the communications on the site during the open trades? I found it extremely useful to have a web of trust with people I traded big amounts of coin with and I liked an effective escrow system for money transfer trades.

I was previously unaware of kycnot.me I'll look through the site, thank you for the recommendation.

Yeah, and Queen is having the music tour of their lives for the past 6 months

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It's hard to feel bad for Paxful though. There were reports on reddit months ago that their marketplace has become almost rampant with scammers offering fake trades that will be reversed.

"1 more down, x remaining." is probably what the regulations and law-imposing authorities must be thinking now after the closure of Paxful. They are getting more and more success in their venture of taking down all the projects that are providing P2P trading services and allowing citizens to buy or sell Bitcoins with fiat.

We all know how much they hate Bitcoin for being a rival of fiat currencies and providing users with financial freedom and that is the reason why they are always trying to find more options and impose more regulations and laws to corner projects so that they shut down their services if they can't comply by the regulations.

The solution is simple: Don't use centralized exchanges.

I don't need to use a centralized exchange to "cash out" my bitcoin, since I can either spend it directly with merchants or trade it peer to peer just as I did when I bought it.
I don't care if centralized exchanges start demanding even more ridiculous KYC or require you to identify all your personal addresses to them. I will never use them and so they have no jurisdiction over me whatsoever. If anything, such draconian rules will just push more and more people to trade using real DEXs, not these centralized fakes like LBC and Paxful.

This will remain an interesting topic and while I believe that more decentralized or anonymous p2p exchanges will become relevant, one has to keep in mind that in some countries authorities plan on expanding the proof of funds law. In my country it could already happen that if you engage in an anonymous p2p exchange without documenting who the other person was, you could have a problem when you once cash out the Bitcoin in an official way and financial authorities ask you to verify the origin of those Bitcoin in the first place. Even though you have done nothing wrong, paid a market price for the Bitcoin and you didn't use funds from criminal sources, a p2p exchange could turn into a problem.

Further, they plan to force exchanges to KYC every single self-custodial wallet address that is used to send crypto to an exchange. I guess the agenda is clear here: undermine even the last little bit of privacy wherever possible. In a worst case scenario you are depositing Bitcoin that you earned doing some freelancer work to your exchange account, then the Bitcoin get frozen at first until you provided KYC for that address and a proof for the origin of those funds. The goal is also to make it hard to use crypto and reduce its everyday utility. That's so outdated and counter-innovation (weird this sounds like a description of the banking system). The powerful banks are often those who complain about crypto and demand stronger regulation for any crypto-based service or functionalities.

Neither LBC nor Paxful were in any way anonymous - they were both entirely centralized and required all the usual ridiculous KYC. If you used either you did not have a shred of privacy.

Not true. There are dozens of actually peer to peer/decentralized/anonymous exchanges: https://kycnot.me/

Well, considering I've been trading in person for years and have never once used Paxful, the answer to that is a resounding no.

It seems the domino of bankruptcy and insolvency is now being replaced with a domino of voluntarily giving up. But I think this isn't part of it. It seems this isn't even about regulatory policies smothering them. Perhaps it is convenient to drop this regulatory challenges excuse, but this isn't the primary reason. This is also not about centralized platforms offering P2P, competing against them. 

This is most probably the result of Youssef's co-founder Artur Schaback's lawsuit against both Paxful and Youssef. Schaback was kicked out by Youssef more than a year ago. Schaback then filed a lawsuit in Delaware 3 months ago. As a direct result of Schaback's legal actions, the "key staff departures" that Youssef mentioned happened. To the point that "there were no engineers, compliance team members, or security personnel left working at the company." This actually prompted Youssef to shut down the platform, specifically its security implications.^[1]

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[1] https://decrypt.co/125411/paxful-bitcoin-marketplace-closure-cofounder-lawsuit

I also lean towards the scenario that competition is the main reason behind this closure, although I am surprised at its speed, as many people use this platform to buy and sell gift cards, which is relatively good and may enable them to hold out for a while, but what happened happened.

Most of P2P platforms are centralized, and those that have been closed are completely centralized, so I do not think that they will have an impact on the market, as alternatives are available.
I hope this war on central platforms ends because it accelerates lockdowns.

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@OmegaStarScream How do you do it? You are almost the first one who's posting topics about closing platforms.