Paxful is a peer-to-peer cryptocurrency trading platform that allows users to buy and sell cryptocurrencies. You can directly interact with users to trade in any cryptocurrency as long as it is supported.
Traders call it the most flexible marketplace because it offers not two or three but hundreds of different payment options across the globe. Since it’s a peer-to-peer trading exchange, you can choose your cryptocurrency sellers and buyers.
However, it can sometimes be tricky to choose and may lead to scams. There have been many cases where users have been duped off their BTC and other crypto holdings due to their ignorance and carelessness. This has repeatedly led to users asking – is Paxful legit?
It is. Paxful regulates all accounts based on its terms of policies and suspends all accounts it deems to be shady. It also provides users with instructions on how to avoid scams before they begin trading.
Apart from these common facts, there is much more about this exchange that you need to know, like the security of its origin, advantages, fees, etc. We’ll cover all these details and more in this very comprehensive Paxful review.
Origin And Overview
In 1995, someone thought – what if I could connect everyone who wanted to sell something to someone who wanted to buy something? The goal was to create a marketplace, and the idea was known as eBay. Fast forward to 2015, Ray Youssef and Artur Schaback, along with a few others, had a similar idea with just a tiny bit of a modification – what if this concept was applied to create something similar for cryptocurrencies?
Thus, was born EasyBitz, an online marketplace where sellers could advertise what they wanted to sell, and buyers could approach them with their offers. Today, it is one of the most popular peer-to-peer trading exchanges in the world. Headquartered in New York, USA, they’ve got many offices in different parts of the world right from Ghana and Pakistan to UAE and the UK where they’ve employed over 200 people.
The core idea of the founders was to create an environment that would facilitate crypto traders to buy and sell freely and anonymously without any regulation. The platform acts as a mediator and has a very intuitive, user-friendly design that works very well for beginners and advanced users alike.
However, this also means you need to be alert because the platform sometimes suspends accounts if there are large transfers and any suspicious activities from your account. Rest assured, this Paxful.com review will detail these suspension cases and what to do if you face such a situation.
The highlights of a great platform are the factors that help it stand out from among its competitors. But in Paxful’s case, it doesn’t have any significant competition due to the unique set of perks its users enjoy.
Some of them are as listed below:
1. Multiple Payment Options
It’s surprising when some users ask us – is Paxful legit? Sure, there have been certain complaints against them, but then the same has been the case for most of the exchanges. But the sheer amount of payment options and tie-ups it has with payment gateways and payment service providers should vindicate Paxful of any accusations.
Businesses are usually stringent with their processes and don’t trust easily. Still, here we have an exchange that supports over 350 different types of payment methods (394 at the time of writing this!). This is simply astounding and unheard of and is enough indication that they’re trustworthy. As you read further, we’ll delve deeper into these payment methods and find out some of the popular supported payment methods.
2. Multiple Forms Of Service
Users can avail of Paxful in either of the two following ways:
1. The Website Form
Fill a small form on their website where you enter the cryptocurrency you wish to buy or sell, choose your preferred payment method to send or receive the money, and choose the amount you want to buy or sell your chosen quantity of cryptocurrency. Once you fill this out, you can look for offers, interact with traders, and decide for yourself which trader works best for you, and at what price.
2. Virtual Bitcoin Kiosk
Users can create a kiosk, which works somewhat like a virtual ATM. You create it, deploy it onto your website or blog site, and when users click on it, they can trade and transfer Bitcoins. This is also a great opportunity for affiliate marketing because you can earn a 2% commission for every trade made using your kiosk.
When dealing with strangers, regardless of how a short interaction with them dictated your trustworthiness, each transaction is risky. To trade in coins for such a high valuation on the sole basis of faith and trust is perhaps a bit of a stretch, and Paxful is well aware.
Whenever a buyer and a seller agree to a trade, the Bitcoins from the seller’s account get transferred into an Escrow account. The buyer is then given some time to complete the agreed-upon payment to finish the trade.
If this period expires, the Bitcoins are automatically transferred back to their owner’s account. Likewise, if the payment is made, the Bitcoins from the Escrow account are immediately transferred to the new owner, and the seller has no way to get back the Bitcoins from the Escrow account during a trade.
4. Analyze And Judge Before Trading
When a system is regulated under authorities, you’re bound by their rules. These rules may not be in your best interests at times, especially if you’re not a resident of the country under which the regulatory authority works.
With Paxful, one of their unique selling points is that you don’t deal blind. You get to interact with a potential buyer or seller, get to know them, and decide for yourself whether you trust them or not.
This ensures you are yourself the judge of each transaction, and in case you come across suspicious users, you can simply choose not to trade and move on. Furthermore, if you believe the user is a potential scammer, you also have a feature to report them to Paxful from within the chat. They then analyze the account and suspend it for a prolonged investigation if they detect something amiss.
5. Excellent Customer Support
Admittedly, they don’t have a lot of options when it comes to customer support. But considering that this is an interactive marketplace more than an exchange, users decide their terms of trade, mandating less interference from the platform staff.
However, they do have an online chatbot that is very responsive and answers all your common doubts. There’s also a support email address, which takes about two business days to respond. You can also post your comments on their forum and rest assured that they’ll reply with guidance on how to proceed with your issues.
Apart from the support staff, their website has an extensive FAQ page that covers guidance for beginners on how to get started, and change language settings, buy or sell cryptocurrencies, and much more. You can follow their Twitter handle where they post the latest help and news, too. They may be stringent with their policies, but one common thing you’ll see in any Paxful review online is that users are never left hanging with their issues.
6. Auto-Generated Wallet
As soon as you create an account with Paxful, a wallet is created for you. Users can download this wallet to store and manage all cryptocurrencies traded from Paxful. Some of the massive advantages of this wallet are 0% commission fees, high-level security, and backup on the cloud.
This wallet is protected by 2 Factor Authentication and users are guided to set up a strong password to keep the wallet secure.
7. The Mobile App
The mobile app, available for both Android and iOS devices, is a multi-featured, multi-purpose application. It’s a wallet as well as a mobile version of the cryptocurrency marketplace for you to trade.
Some of the key features of this application are:
- Check your balance in real-time, and as soon as it’s updated.
- Profile personalization – show the world who you are so you can gain trust and, subsequently, credible buyers and sellers will be interested in trading with you.
- Check the status of all your pending transactions and raise a ticket with customer service in case of issues.
- Get access to the latest buying and selling conversion rates for fiat to crypto transactions
- Portable version of the website with full features – buy, sell, chat, and do everything you could from within the website.
The goal of this Paxful review is to enlighten your readers about the yin and yang – the light and dark shades of this exchange. While it’s true that Paxful is one of the best at what it does, the online cryptocurrency marketplace does have certain aspects it could improve upon.
These aspects are as follows:
1. Limited Trading Coins
Some exchanges offer hundreds of coins and many fiat currencies to choose from, but Paxful isn’t one of those exchanges. Users can only trade Bitcoins, Tether, and Ethereum on Paxful.
2. Be Wary Of Scams
Although the marketplace has taken steps to curb scams, there are always cases where people are careless or too trusting. Often, these are the cases where people fell for payment or deadline-related lies and made transfers by ignoring the best practices of the trade. All users need to be wary and realize that no platform can verify each user’s motives.
3. Transaction Fees Determined By The Seller
As a seller, one can ask for any amount as an exchange price, and this figure may not necessarily be the market standard. As a result, if a buyer isn’t alert, they could end up paying much more than they should. To avoid this, you need to conduct proper research about the market prices and check out more than a few offers on Paxful. This Paxful.com review has once again highlighted that all users need to be aware and careful at all times.
Security And Best Usage Practices
Is Paxful legit and trustworthy? The answer lies within the security they’ve put in place to ensure your trades aren’t vulnerable to hackers. Although the exchange doesn’t work exactly like other exchanges, it has standard encryption and other security measures.
The Paxful exchange uses 256-bit SSL through renowned cloud services-based SaaS securities provider Comodo.
We already saw that a wallet is generated for each user to secure their money. This wallet, known as the BitGo wallet service, boasts many high-tech features. These include 2 Factor Authentication, Secure 3D payments integration, and requirements for dual-factor code to initiate every cryptocurrency trade. Escrow protection can also be considered a part of their security schemes as it keeps your funds safe.
While all these measures are in place, one must always remember that individuals directly interact with each other over this platform, so one must always follow the best practices while trading to ensure they aren’t scammed.
The platform does have a few guidelines they share with users to help them stay away from scammers; ensure you abide by them thoroughly.
The Wide Support – Coins, Countries, and Payment Methods
While this Paxful review already highlights the lack of cryptocurrencies as a con, the real agenda of this marketplace has always been dissimilar to mainstream exchanges.
You’re spoilt for choices when it comes to payment options. This plays a major role because it facilitates transactions from across the globe. Remember, a payment mode that’s popular in your country may not even exist in another country. They’ve got all bases covered in this regard, and here are the six major categories that amount to over 390 modes of payment:
- Direct Wire/Bank Transfers – you can transfer within, as well as outside your country. Be careful, sometimes certain accounts may have a daily transfer limit, so it’s always better to check with the bank once before committing to any payments.
- Virtual Currencies: Cryptocurrencies such as Ethereum, dogecoin, Litecoin, and many more are accepted as modes of payment. This means you can exchange one cryptocurrency for another, or buy it in exchange for fiat currency.
- Goods and Services: You can choose any materialistic object, right from high-end gaming consoles to antiques, gold, or anything you can think of – everything is accepted.
- Gift Vouchers/Gift Cards: This includes gift cards from all major vendors such as Amazon, Google Play, and Xbox.
- Plastic Cards: All credit and debit cards are accepted. Once again, watch out for daily limits or geographical restrictions your bank may have imposed on your card.
- Online Wallets: From Amazon Pay, Google Pay, PayPal, and MPesa to mobile recharge and DTH recharge (only in some countries), all major wallets are supported.
When it comes to geo-restrictions, there are a few countries where Paxful isn’t available. These are:
- Central African Republic Sanctions
- North Korea
- Republic of Congo
- South Sudan-related Sanctions
- Sudan and Darfur
What Are The Fees?
A fee of 0.5% is levied on all cryptocurrency conversions. The platform does not charge any commission for trades you make by mutually agreeing to exchange rates when you purchase Bitcoins.
There is a fee applicable for selling cryptocurrencies, and it depends on your chosen mode of payment. The best deal would perhaps be bank transfers because only a 0.5% fee is levied. For all other payment methods, the platform charges you at 1%. The only exception is the gift cards, where you incur the highest charges – 5%. Also, Paxful earns a small commission from your trades – upon successful transactions, a small fee is transferred from the escrow account to Paxful.
The Website also has buying limits based on the level of verification of your account. There are four levels in all, and US users must have level 3 access to trade on the platform. You can see the limits of each level on their website.
Concluding This Paxful Review
Despite being under the gun for suspended activities, this Paxful review proves that the marketplace is indeed legit and trustworthy. Although it does have limited choices, it would be wrong to say other exchanges are better than Paxful, simply because Paxful is more than an exchange.
Apart from its mobile application and features such as its wallet, there are factors like anonymity, interactions pre-trade, security, and more which help Paxful stand out – as if being a full peer-to-peer exchange where traders can directly interact with each other didn’t help it stand out already.
It’s clear from this review that if you’re alert and follow the official verification processes, this exchange-cum-wallet is an intriguing, intuitive, must-have experience for crypto traders, regardless of whether you’re an advanced user or a beginner.
Laura has been interested in finance for a very long time, especially since her graduation in Economics. With the increasing popularity of cryptocurrency, she decides to read up more on the subject and soon became an expert. Laura has been dabbling with crypto ever since and started investing in them in 2017.