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Paxful Review 2024: Features, Fees & Security
Luis Clark
- URL: https://paxful.com
- Headquarter: 3422 Old Capitol Trail, Wilmington, Delaware, the United States
- Year Founded: 2015
- Platform App: Mobile/Web
- No. of Cryptos: USDC, Bitcoin, Ethereum, USDT
- Fiats Available: USD, GBP, CAD, INR, NGN, Euro, KES, CNY, DZD, ARS, BSD, and 20+ more
- Withdraw Method: Peer-to-peer trading (WePay, eZcash, Chewy, Petco, Wise, Bank transfer, Gift cards, debit card, and credit card, Perfect Money, Mobile Money, PayPal cash deposit to bank, Chipper Cash, Skrill, Neteller, and 330+ more)
- Payment Method: Peer-to-peer payments (WePay, eZcash, Chewy, Petco, Wise, Bank transfer, Gift cards, debit card, credit card, Perfect Money, Mobile Money, PayPa,l cash deposit to bank, Chipper Cash, Skrill, Neteller, and 330+ more)
Paxful Review: Our Opinion
Our hands-on experience with Paxful revealed that the peer-to-peer exchange stands out for its large selection of payment methods.
However, that’s about it as Paxful only supports 4 cryptocurrencies, doesn’t offer advanced trading features like margin trading, futures, etc., and has no staking rewards or NFT support.
Paxful users also complain about the number of scam traders on the platform stating that the exchange isn’t doing enough to curtail fraudulent merchants.
The exchange has also been riddled with numerous controversies which may make new users wary.
That said, Paxful remains the largest Bitcoin peer-to-peer marketplace by trade volume.
An Overview of Paxful
Paxful was founded in 2015 by Ray Youssef and Artur Schaback.
The exchange is a peer-to-peer marketplace that initially started as a payment processor for brick-and-mortar businesses.
Paxful has since been reintroduced as a marketplace for buying and selling Bitcoin from other traders.
That said, the P2P exchange has been riddled with various controversies over the years.
For example, the platform’s owners were arrested in Miami in an incident where Artur Schaback was spotted by residents to be holding an automatic rifle on a penthouse balcony.
Also, Paxful was shut down in April 2023 after the CEO of the company Ray Youssef expressed concerns about the safety of customer funds owing to a lawsuit from its cofounder who sued Paxful and Youssef for wrongful termination.
However, by May 2023 Paxful came back online.
Pros
- Largest Bitcoin P2P marketplace by trade volume
- Large selection of payment methods
- Beginner-friendly
Cons
- Limited crypto selection
- Lacks advanced trading features
Paxful Review: Unique Features
Paxful Wallet
The Paxful wallet is a Bitcoin wallet that gives you a secure way to manage your funds.
With the Paxful wallet, you can send and receive over 40,000 BTC.
The Paxful wallet has a user-friendly interface and can be used on all devices. The wallet also features best-in-class security features like strict verification and password requirements which ensures that your funds are always secure.
Aside from the sending and receiving of Bitcoin, with the Paxful Wallet, you can also top up directly from the Paxful P2P marketplace using your preferred payment method.
Paxful Pay
Paxful Pay is an integration that you can set up with your business or e-commerce website to receive payment for goods and services using various payment methods such as online wallets, gift cards, etc.
While Paxful Pay enables you to add a new payment method to your store it is also chargeback-free.
Paxful Pay involves 3 parties: Merchants (selling a product or service), buyers, and Paxful vendors (exchanging buyer payment methods for BTC).
The merchant controls the configuration of Paxful Pay for their business.
Even if the merchant is not willing to receive payment in BTC, there are several ways to convert the BTC and receive it to local fiat currencies using Paxful vendors.
Paxful Pay transactions are handled through the Paxful peer-to-peer platform.
Each transaction has a tracking ID that merchants can use to track the status of the transaction.
Merchants can also configure a callback on every successful payment. This can be set up to release the product to the buyers.
The Paxful Pay integration uses the Paxful secure escrow systems which ensures that both merchants and buyers are safe.
Paxful prevents phishing using a secure URL token system. This token system must be used to enable automatic send-outs to your Bitcoin address.
All Paxful Pay payments are handled in BTC. This means that merchants can keep their payments as BTC in the merchant account to exchange for EUR, USD, or any other preferred fiat currency.
You can also move the funds from your merchant account to your Paxful wallet.
Paxful does not charge merchants any fees for the use of Paxful Pay.
That said, merchants can request any amount but the minimum trade amount is 10 dollars.
Also, Paxful does not place any direct limitation on the purchase size, however, for large sums, the vendor can request additional KYC procedures and the buyer may need to make multiple trades.
You can configure your kiosk link for Paxful Pay to open inside an iframe or to open in a new tab.
If you configure it to open in iframes, it will be embedded right into pages, this means that visitors do not need to leave your website to make payment.
That said, your buyers will need to register as users to use Paxful Pay.
You can, however, simplify the process for them by providing the buyer’s email together with the generated URL so it is prefilled for users.
Paxful Pay offers several configuration options that allow you to configure the link.
Available configurations include:
- Currency: This allows you to request payment in fiat currency or BTC
- Callback: This allows you to define the callback address that will handle the callback parameters
- Receiver: By default, all payments made by buyers are deposited into your merchant account balance, but this configuration allows you to configure deposits to any Bitcoin address.
As already stated, with Paxful Pay, your customers can make payments with any crypto wallet of their choice. They can also checkout using their Paxful wallet or they can create one on the spot.
Making payments with Paxful Pay is straightforward.
Here is how it works:
Your customers select Paxful Pay at checkout and login to their Paxful account
Next, the customer will select a wallet and confirm payment.
Once the payment is done, the funds will be transferred to your account.
Cryptocurrencies Available on Paxful
Paxful supports 4 cryptocurrencies. Supported cryptocurrencies include Bitcoin, Ethereum, USD Coin and Tether.
Paxful Fees
Paxful Trading Fees
Paxful charges one trading fee which is a singular service fee.
This service fee is paid by the seller of the cryptocurrency and it amounts to 1% of the entire trade volume.
In comparison to other similar centralized exchanges, Paxful trading fees are very high as the industry average sits around 0.20%.
That said, Paxful charges this fee because the buyer doesn’t pay any trading fees at all.
Withdrawal Fees
Paxful fees for withdrawal vary based on the amount being withdrawn.
For example, for Bitcoin withdrawals over 20 USD equivalent Paxful charges 0.0004 BTC. This is minus the usual blockchain network fees that you’ll have to pay to miners for block validation.
Paxful Review: Payment Methods
Paxful offers more than 350+ payment methods including WePay, eZcash, Chewy, Petco, Wise, Bank transfer, Gift cards, debit card and credit cards, Perfect Money, Mobile Money, PayPal, cash deposit bank, Chipper Cash, Skrill, Neteller.
The Paxful platform keeps adding new payment methods from time to time. However, every supported payment method is only available via peer-to-peer transactions.
There are no instant buy-and-sell payment options.
Paxful Review: Security
Through our first-hand exploration of this exchange, we discerned that Paxful is a secure exchange with several security measures in place to keep users’ funds on Paxful safe and to ensure a secure marketplace.
Paxful is a regulated crypto exchange with a strict verification process.
The exchange has an Anti-Money Laundering policy and complies with the Office of Foreign Assets Control (OFAC) rules.
It also has an army of dispute and fraud prevention analysts who try to keep bad actors away from the Paxful marketplace and ensure that trades run smoothly.
Paxful has an escrow system that ensures that the crypto being traded is held safely until both parties in a trade complete their part.
Paxful uses BitGo as its wallet service provider and also equips users with adequate security features to keep the funds in their accounts on Paxful safe. A major security feature on Paxful accounts is two-factor authentication using Google Authenticator.
Two-factor authentication is enabled for logging into the account and sending crypto out of the Paxful wallet.
Users that trade on the marketplace are also protected with Paxful escrow and Security Deposits. Security deposit requires Paxful sellers to commit to their sell offers, this creates a safer trading environment, increases the number of completed trades, and reduces the number of cancellations.
To create an offer on Paxful and Sell BTC, you will need to first place a deposit. Offers are not activated until you meet the security deposit.
Security deposits vary by country but can be as low as 0.005 BTC.
Your security deposit will be returned to you 7 days after your last trade with a security deposit.
Staking Rewards
Unfortunately, Paxful does not offer staking rewards as it is strictly a peer-to-peer marketplace.
Supported Countries
Paxful is available to users in over 100 countries across the globe.
Supported countries include Japan, Germany, France, Nigeria, Australia, South Africa, the United Kingdom, Brazil, some parts of the United States, etc.
Our team’s first-hand exploration of this crypto wallet revealed that Paxful complies with the Office of Foreign Assets Control (“OFAC ”) sanction.
Paxful services are not available to residents in OFAC-banned countries including: Belarus, Cuba, Crimea, Donetsk and Luhansk regions of Ukraine, Iran, Iraq, Lebanon, Central African Republic Sanctions, Burundi, Russia, North Korea, Yemen, etc.
Residents of OFAC high-risk/grey countries like Ukraine, Kosovo, Bulgaria, Zimbabwe, etc. must verify their ID before sending out or selling cryptocurrencies.
Paxful is not available to users in Canada and in select US States including Florida, California, Idaho, Illinois, New York, North Carolina, South Carolina, Vermont, Washington, Texas, Ohio, Maine, Hawaii, Delaware, Connecticut, Alaska, Louisiana, etc.
Access to Tether and USD Coin is prohibited to users residing in Texas.
Opening a Paxful Account
To open a Paxful wallet account to buy and sell Bitcoin, go to https://paxful.com.
Tap on the “Register” button at the upper right corner of your screen.
On the next screen, you can choose to create your Paxful wallet account using your phone number or email address.
For this example, we’ll use the email address option.
To do so, tap the email address button and then enter your email address as well as select a password.
Note that the password must have a capital letter, symbol, and alphabet.
You will also have to select a username at this point, which will be how other peer-to-peer traders will interact with you.
Click on the box to agree with Paxful’s Terms of Use and Privacy Policy.
Tap on “Create Account” and Paxful will send a link to verify your email to your inbox.
Go to your email address and click on the activation link to verify your registered email.
That’s it! You’ve successfully created a Paxful wallet account to buy and sell Bitcoin.
Trading Experience
Leveraging our expertise in centralized exchanges, we observed that Paxful offers a trading experience best suited for beginners and intermediate traders who want to buy Bitcoin.
Unlike most peer-to-peer centralized exchanges, Paxful offers a limited selection of cryptocurrencies (just 4). However, it has different payment methods (over 350), which make it seamless for users to buy Bitcoin and exchange supported digital currencies for fiat.
The peer-to-peer marketplace is available on mobile devices for Android and iOS devices as well as on the web.
Navigating the peer-to-peer exchange is also seamless and most newbies will find it straight-forward.
That said, Paxful is known in the crypto space for having a lot of scam traders (especially unverified merchants).
This makes the trading experience stressful especially for beginners, who need to be wary of the Paxful users they trade with.
Also, although Paxful supports different payment methods, some of the payment methods do not have adequate liquidity (Paxful traders are willing to trade cryptocurrency using that method).
Customer Service
Paxful offers customer support to users on the Paxful website and via email.
Paxful support is also available via direct message on Twitter, Facebook, and Instagram.
Currently, customer support is only available in the English language.
The exchange does not offer support via direct message on social channels like Telegram, TikTok, or WhatsApp.
Customer Satisfaction
Our detailed firsthand scrutiny of this crypto exchange showed that Paxful is a beginner-friendly exchange with a large selection of payment methods.
Customer reviews on third-party review platforms show that the majority of customers are satisfied with the easy and fast process of buying and selling cryptocurrencies on Paxful.
Several users have, however, complained about the numerous scam merchants and buyers on the platform.
Does Exchange Offer Education?
Yes, Paxful offers crypto education via the Paxful University that covers various beginner topics on subjects such as the blockchain, Bitcoin USDC, etc., and the latest happenings in the industry.
Paxful is Right for You If:
- You want to trade crypto with other people not directly with an exchange
- You want to exchange crypto for gift cards or vice versa
- You need a large selection of payment methods
- You are only interested in trading a few cryptocurrencies
Final Thoughts
Paxful is strictly a peer-to-peer trading platform that offers a limited selection of cryptocurrencies.
It stands out for its large selection of payment methods, however, this comes with users complaining about the scams encountered when trying to use the exchange, especially with unverified merchants.
Paxful stands tall, but there are other giants in the crypto world. Get insights with our Dydx analysis.
FAQ
Most frequent questions and answers
Yes, Paxful is a legit crypto exchange where you can buy Bitcoin. However, safety when using the platform depends on the user following recommended processes such as trading only with verified merchants, keeping on transactions on the Paxful platform, etc.
Paxful was shut down because of a lawsuit from a cofounder who accused the exchange of wrongful termination and the suit threatened the safety of customer funds.
Yes, Paxful charges different withdrawal fees depending on the volume of the withdrawal.
Yes, people make money on Paxful as merchants when they buy low and sell at a higher price to other users.
We always try to provide the most accurate information available, and make sure our team follow through.
If you want to know more about our Crypto Exchanges Review Methodology follow the link below
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