Bitcoin Platform with 1.5m Nigerian Ceases Operations

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The Nigerian peer-to-peer Bitcoin exchange Paxful, which has 1.5 million customers overall, has announced it is ceasing operations.

This information was released in a blog post on Tuesday by Ray Youssef, co-founder and CEO.

He stated, “Today, Paxful will be suspending its marketplace. We are not sure if it will come back. This will probably come as a big shock to many. While I cannot share the full story now, I can say that we unfortunately have had some key staff departures.

“Also, regulatory challenges for the industry continue to grow, especially in the peer-to-peer market and most heavily in the U.S. While we work through these issues, we have taken the most secure option and ask you to explore self-custody and trade elsewhere.”

According to the cryptocurrency-focused news site Decrypt, Youssef said on Twitter that a lawsuit filed by a Paxful co-founder who is suing Paxful and Youssef after being “kicked out of the platform” over a year ago also had an impact on the decision to shut down the platform.

He wrote on twitter, “My co-founder sued the company and sued me. I have a lawsuit over my head right now.”

Despite without mentioning the plaintiff by name, Youssef was most likely alluding to co-founder Artur Schaback, who, according to a court docket made available on CourtConnect, sued Youssef in Delaware Chancery Court in January.

Although the use of cryptocurrencies is prohibited in Nigeria, the 2020 Geography of Cryptocurrency Study by Chainalysis put Nigeria ninth in terms of adoption and usage among the 154 nations examined.

Recap, a crypto accounting services company, created a list of the top 50 crypto hubs in 2022 and included two Nigerian cities—Lagos and Ibadan—among its list of the world’s busiest cryptocurrency hubs. Lagos (at number 14) and Ibadan (at number 24) are both cities in Nigeria.

Peer-to-peer technology usage in Nigeria is credited to Paxful, which also contributed to the growth of the country’s cryptocurrency market.

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