Paxful Reopens Amid Legal Distractions

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  • Peer-to-peer exchange Paxful has reopened a month after closing
  • The company’s co-founder, Artur Schaback, has left following months of discord with fellow co-founder Ray Youssef
  • Schaback is suing Paxful and Youssef over his dismissal

Peer-to-peer crypto exchange Paxful has resumed operations a month after shutting down, amid a courtroom battle between its former creators. Following almost eight years of operations the company suspended operations in early April following “key staff departures” and the increasingly tough regulatory environment, but news of a falling out and a courtroom battle between the two founders has since emerged which throws a new light on matters.

“Key Staff Departures”

Paxful was established in July 2015 by Ray Youssef and Artur Schaback as a payment processing platform for physical retailers but later transitioned to become a peer-to-peer marketplace. After eight years however, the company called it quits, with Youssef explaining at the time that there was more to the story than he could let on:

While I cannot share the full story now, I can say that we unfortunately have had some key staff departures.

That key departure has turned out to be Schaback, who was kicked out of the company by Youssef following months of acrimony between the pair. Coindesk learned from former employees that Paxful had been suffering from chronic professionalism from the management, including “promotions based on favoritism, erratic dismissals, lavish spending on travel and reports of routine cannabis usage on the job by Youssef himself.”

Schaback has since sued Youssef and the company over his dismissal, which was one of the factors involved in Youssef closing down the company.

Paxful Back, but for How Long?

With all this going on it’s not immediately clear how Paxful has been able to relaunch, although Schabeck told Coindesk that the company is currently owned by a custodian, who serves as a director.

The company didn’t give much away in its relaunch text, except to say that the team had “worked diligently to get the marketplace back online” and that they were “delighted to be back so that we can continue to serve millions of people without financial access.”