Paxful Faces Imminent Closure Amidst Worsening Operational Crisis
Social media platforms are flooded with complaints about the platform’s inefficiency, citing problems such as a surge in fraud cases, slow transaction speeds, arbitrary account bans, disputes left unresolved, and difficulties in fund withdrawals.
By Anna B Kiwanuka
Paxful, the cryptocurrency exchange, has been in the spotlight this year for both positive and negative reasons. Earlier, there were rumors of a shutdown, internal conflicts among co-founders, and a subsequent relaunch. However, recent revelations indicate that Paxful continues to grapple with issues, hindering its ability to provide efficient services to customers.
Behind the scenes, the company faces several challenges, leading to customer dissatisfaction. Social media platforms are flooded with complaints about the platform’s inefficiency, citing problems such as a surge in fraud cases, slow transaction speeds, arbitrary account bans, disputes left unresolved, and difficulties in fund withdrawals.
One user shared their experience of attempting to withdraw nearly $2,000 USDT, which has been pending for a week without a transaction ID. Similar complaints from other users suggest a recurring problem on the platform. Paxful’s support team responded vaguely, indicating a lack of clear resolution timelines.
Additionally, insider sources revealed to Technext publications that Paxful is operating at a loss and dipping into user funds to cover legal expenses. The company is allegedly on the verge of financial instability, raising concerns about its future. Tensions between co-founders Ray Youssef and Artur Schaback have further complicated the situation, leading to management changes and operational challenges.
Under the new leadership of CEO Roshan Dharia, the company is reportedly functioning with minimal staff, notably lacking in compliance officers and engineers. This shortage has contributed to the recent withdrawal issues, raising questions about the platform’s safety and adherence to industry standards. Paxful, which once boasted about 200,000 daily transactions, has seen a significant decline, dropping to below 30,000 daily transactions. Consequently, trade statistics that were previously public have been removed from the website, reflecting a concerning trend for the exchange.
Furthermore, Paxful has faced legal challenges, including a recent default judgment in a New York court, resulting in substantial financial liabilities. Despite these mounting concerns, when approached for comments, CEO Roshan Dharia remained optimistic, stating that Paxful has appointed experienced executives and is well-capitalized, with millions of users globally. However, the company refrained from addressing specific allegations.
Paxful’s future remains uncertain as it navigates these challenges, leaving users and the crypto community closely watching how the exchange will address its issues and sustain its operations in the face of mounting obstacles.