Paxful Platform Review – Is It Safe or a Scam?
Do you know what’s challenging? Converting your fiat into cryptocurrency and vice versa.
If you’re American, you can buy bitcoin with 1 click using Coinbase. How about buying bitcoin anonymously? Let me introduce you to Paxful, which is a popular P2P exchange platform. Paxful allows you to buy bitcoin, hassle-free. The website is like the “eBay of cryptocurrency”. The platform connects you to other people, who are looking to buy or sell cryptocurrency. Thus, you can shop around and find the best value. Using Paxful is easy, that’s why the platform is popular.
- Is Paxful safe to use?
- How secure is it?
- Who is behind Paxful?
In this review of Paxful platform, I will answer your most pressing questions and more. Let’s investigate …
The team behind Paxful
Ray Youssef is the CEO and he was an ex software engineer. Artur Schaback, the co-founder of Paxful, was the founder of Kaizern, a software company that specialized in blockchain app development. Before Paxful.com, Paxful was involved in the bitcoin ATM industry. They also own Netcoins.app According to their website, they have offices in New York City, Hong Kong, Manila, and Talllin. Nice! Okay, sounds great. But why should you use Paxful instead of Binance? Good question. Paxful differs from Binance in many ways.
How useful is Paxful? Examples …
It’s Christmas and your relatives are visiting; they’re gorging themselves on turkey and baked beans. “Happy Christmas, sonny boy! Here are some gift cards and sweaters for you!” says Uncle Jim, half drunk. He hands you a fistful of gift cards. But you want cash and crypto, not some useless gift cards to buy more pizza. You want to stack your bitcoins and retire on a private island before your 30th birthday.
Imagine another scenario:
An African man in Japan needs to send money back home to Africa but he doesn’t want to pay the outrageous 8% remittance fee. Is there another alternative? Oh! Here comes Paxful: you can exchange your gift cards for crypto. Or you can sell Japanese fiat to buy crypto and send the money home (and bypass the outrageous 8% remittance fees) (What I especially like about Paxful is that you can sell “obscure” Giftcards like Chili restaurant gift card and Forever 21 gift cards. It’s like they have the whole gift card market covered!) You can do cash in person, cash by mail, cashier’s check, Money Gram, Bitcoin ATM. Wow! Hmm, that sounds wonderful. What about the process of buying crypto on Paxful? How does that work?
I’m glad you asked because I’ll walk you through the process …
How to buy and sell on Paxful?
Always trade with a merchant that has a high customer feedbackYou can buy crypto on Paxful in 3 simple steps:
- You see a seller you like, start a trade
- You send the payment and wait
- The seller sends you the crypto
How do you know that the seller won’t run away with your crypto? Paxful acts as an escrow, which ensures the safety for you and the seller. Note: Paxful isn’t going to reimburse you if you’re doing business with a scammer. Always take precautions! (I’ll give you some tips below) When the trade is successful, leave the user a rating and comment. And tell the seller to do the same for you. After all, the feedback is a testimonial. The better your reputation, the easier the trade. People trust you more because your account has a good reputation. Trading on Paxful is simple and streamlined. But wait, there’s more! I’ll talk about the fees, how to bitcoin anonymously, and precautions you should take when trading.
What are the fees like?
If you’re buying, I have good news for you. It cost you $0 fees to buy because the burden is on the seller. If you’re buying bitcoin using bank transfer, credit card, online wallets, cash, or gift cards then there are no fees (however, the bank will charge you a service fee, won’t they …) However, if you’re going to use a debit card to directly buy bitcoin then the cost is going to be higher. I would recommend to you another site like CEX or Coinmama if you’re buying using debit directly. What if you’re selling on Paxful? There’s a fee. However, if you’re the seller, then the fees range from 0.5% – 5%. Debit cards, cash, and online wallet are 1% fee and gift cards range from 3-5%. Here’s another important question …
What about ID? Could you buy bitcoin anonymously?
You can use cash and gift cards to buy BTC anonymously. Paxful won’t ask you for ID if you have a tier 1 account. And if you’re buying BTC with gift cards, the merchant won’t ask for ID. However, if you’re using bank transfer then some merchants will require ID. If you want to buy anonymously, you can always meet the person at your local coffee shop and exchange coins — “Hey! Here’s my cash. Now gimme some coins please …”
Is Paxful secure?
Paxful hasn’t been hacked. When it comes to security, you need to keep your account secure. This means having a good password and using 2FA. The theft case in Paxful is minimum and there’s 24/7 customer service on the website, should you need any help.
Warning! Take these precautions when buying or selling
Only do business with merchants that have good feedbacks! The #1 problem is dealing with the merchant. You must only do business with people who have a high rating. This means the account is aged and has plenty of positive customer feedback. What if you send the money but the person doesn’t you the bitcoin? You can open a dispute and a moderator will look into the case. Hopefully, you won’t have to dispute. Oh yeah, there have been cases of Paxful freezing customers’ accounts. You shouldn’t leave your bitcoin on Paxful’s wallet. As the old saying goes “not your wallet, not your bitcoin.”
Prevent your account from getting hacked!
Hackers have hacked into Paxful accounts and sold them in the dark market. Note: Paxful.com wasn’t hacked. Instead, the hackers tricked the users into giving their usernames and passwords via phishing attack. So you want to make sure your account is safe with 2FA (2 Factor Authentication). You also need a strong and secure password. If possible, use Linux or macOS instead of Windows. Side note: I have heard stories of Paxful locking an account. But because the algorithm flags your account for being suspicious. For example, using Paxful to launder money or your account has too many disputes. If you’re using Paxful to only buy bitcoin, you should be fine.
The #1 scam to watch out for
If you’re selling crypto on Paxful, you need to watch out for scams. What is a common scam? Someone sells you a gift card but the card is already redeemed. Ouch. Avoid headaches by only doing business with well-established accounts. Carefully select who you’re doing business or else you’ll regret it.
What do I like about Paxful?
Paxful makes buying crypto easy. Moreover, selling gift cards for bitcoin is awesome. Also, the fees are reasonable. The website is intuitive to use, and the user interface design is aesthetic. Paxful looks modern, unlike other websites that look ancient. Yes, I’m looking at you, Localbitcoins.com. Customer service is there if you need help. There are moderators to handle disputes. The merchant doesn’t send your bitcoin? No problem, just summon a moderator. I’m a veteran in the crypto space and I have noticed the shift: people using Paxful instead of Localbitcoin. Perhaps it’s because Localbitcoin has failed to innovate. Paxful makes it so easy and secure to buy crypto. Yes, I’m happy with their service. There is no country restriction on Paxful. For example, if you’re American, you can’t trade on some of the best crypto exchanges like Binance However, since Paxful is a P2P exchange, you’re free to trade to your heart’s content. That’s what I call freedom!
The final verdict on Paxful
In my research, Paxful seems legit. As of 2020, Paxful is still on the rise. 220,000 visitors a month reach the site, so they’re doing something right. Buying crypto on the site is an easy and enjoyable experience. Paxful is a legal company: they have 4 different offices on 3 continents and are a registered company with the face of the CEO on the company’s website. I have tried finding scandals or negative reviews against Paxful and it’s mostly about users that complain about locked accounts (they’re doing fishy things with the accounts, that’s why they’re locked out) Paxful is not a scam. But watch out for scammers on Paxful and you should do okay.
Article Produced By
Harsh Agrawal
About Harsh Agrawal:
An award-winning blogger with a track record of 10+ years. He has a background in both finance and technology and holds professional qualifications in Information technology. An international speaker and author who loves blockchain and crypto world. After discovering about decentralized finance and with his background of Information technology, he made his mission to help others learn and get started with it via CoinSutra. Join us via email and social channels to get the latest updates straight to your inbox.
Expertise:
Harsh Agrawal has an experience of 12+ years in fintech, and 5+ years in the filed of Blockchain and Bitcoin. He has also moderated the panel of Blockchain experts, and attended international blockchain events like BTCMiami, Token2049 to name a few.
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