Key takeaways:
- Paxful has now officially restarted operations after a prolonged suspension that lasted more than a month,
- It’s unclear how Paxful plans to proceed, despite the platform’s assurance that its wallet was completely operational” during the service’s suspension.
Peer-to-peer Bitcoin exchange Paxful stated on May 8th that it will resume operations after a one-month hiatus. In an unexpected post published on April 4th, the exchange first declared that it would be ceasing operations. Paxful said at the time that the relocation might or might not be temporary.
The company’s dedication to protecting its clients and securing the future of Paxful led to the difficult decision to temporarily halt the platform in early April.
In the upcoming days, market operations will be “gradually” restored, according to the peer-to-peer cryptocurrency marketplace. On its website, Paxful also stated that their wallet was still operational during the closure and that it had given customers access to other platforms.
However, the blog post did not provide any updates regarding the company’s leadership or the ongoing lawsuit. The sudden reopening of the exchange has caught some industry participants off guard.
It is important to note that court records from March revealed allegations exchanged between Paxful CEO Ray Youssef and co-founder Artur Schaback, accusing each other of misappropriation of company funds, money laundering, and evading U.S. sanctions against Russia.
These allegations were made before the suspension of the marketplace’s operations. Youssef later attributed the shutdown to the U.S. regulatory environment and mentioned that there would be significant staff departures in a subsequent blog post.
The Paxful wallet was fully functional throughout the suspension period, allowing users to continue using their cash and interacting with the Paxful community. The user base felt secure because they could continue their financial transactions despite the brief interruption because of this continuity.
By April 17, 88% of the funds on Paxful’s platform had been successfully reopened. However, because of a legal dispute between the co-founders, almost $4.4 million was still blocked. One of the parties to the dispute refused to cover the compliance costs necessary to release this money.
In contrast to many other businesses that encountered financial difficulties in 2022 and were forced to halt customer withdrawals, Paxful was able to resolve this issue without filing for bankruptcy or initiating restructuring procedures.
