U.S. Sanctions Force Paxful to Exit Crypto-Friendly Venezuela
Paxful crypto exchange has shuttered operations in Venezuela citing United States sanctions, which bars Americans from doing business with the Nicolas Maduro-led nation, according to reports on September 15, 2020.
Paxful Leaves Venezuela
Paxful, a leading peer-to-peer (P2P) United States-based bitcoin (BC) marketplace has announced that its services will no longer be available to Venezuelan residents. The exchange claims the move is part of plans to remain in compliance with the statutes of U.S. regulators.
In an email sent to users in the region today, Paxful stated categorically that the regulatory challenges it’s facing in the region is far higher than its risk tolerance and as such, the best thing to do is to stop serving users in the country.
“Due to concerns regarding the regulatory landscape around Venezuela and Paxful’s own risk tolerance, we regret to report that Paxful will be ceasing operations in Venezuela. We made our best efforts for several months, but with current risks, we had no choice but to make this incredibly difficult decision.”
A Long Time Coming
Per sources close to the latest development, Paxful had previously put some measures in place designed to enable it to stay on the right side of the Office of Foreign Assets Control (OFAC) regulations.
Specifically, the P2P exchange had previously barred Venezuelans from using Banco de Venezuela bank accounts on its platform and it also forbid the use of the nation’s Petros crypto on the site
According to a recent report by blockchain analytics firm Chainalysis, Venezuela is among the top five countries in the world in terms of crypto adoption and P2P trading activities. However, Paxful has failed to gain significant traction in the state.
Leading P2P bitcoin trading venue, LocalBitcoins facilitated a massive $4.5 million worth of bitcoin transactions in the past week alone, while Paxful only managed less than $25,000 in the same period, according to data from Useful Tulips.
In related news, earlier in June 2020, BTCManager informed that the President Nicolas Maduro-led administration has announced an increase in the price of petrol in the country and made the petro crypto an accepted payment method in all local gas stations.
At press time, the price of bitcoin (BTC) is up by 2.51 percent in the past 24-hours, trading at $10,666.35, with a market capitalization of $197.22 billion, as seen on CoinMarketCap.