Paxful Review: Pros & Cons
Pros
- It has a global user base
- The wallet has no chargebacks
- Users can track their transactions
- There are over 300 payment methods
- There are more than six million users on the platform.
Cons
- Support options are limited
- It has a limited selection of crypto
- Risk of scams by unscrupulous users
What is Paxful?
Paxful, initially known as EasyBitz, is a well-established peer-to-peer cryptocurrency exchange platform founded in 2015 and headquartered in New York. The platform was founded by Ray Youssef, a software engineer, and Artur Schaback, the founder of Kaizern, a blockchain software company. Together, they wanted to build a virtual kiosk that eased the process of buying and selling bitcoin.
To activate the Paxful wallet, a buyer needs to make a cash deposit to the seller’s account using one of Paxful’s payment options, such as prepaid VISA, Gift Card Code, or Western Union. The seller releases Bitcoins to the customer immediately once they have received payment confirmation via Paxful wallet’s escrow service.
In addition to being able to accept more than 85% of worldwide buyers, sellers can take more than 300 different payment methods. Users can trade Bitcoin, Ethereum, and Tether USD, and it supports more than 140 fiat currencies.
Paxful Wallet
Since the Paxful wallet is available online, it makes a great alternative in countries where cryptocurrency is restricted; you can meet up with your peers and fearlessly exchange your currencies. This promotes accessibility and convenience to different people across the world. Currently, it is host to over 87,000 vendors and averages 220,000 visits every month.
Unfortunately, due to laws on regulations, Paxful is unavailable in a few countries, including Burundi, Central African Republic Sanctions, Cuba, Crimea region, Iran, Iraq, Lebanon, Libya, North Korea, Republic of Congo, Somalia, South Sudan-related Sanctions, Sudan and Darfur, Syria, and Yemen. In the US, it is unavailable in New York, Washington, and West Virginia. Users in Texas are also prohibited by the law from accessing Tether trading.
Is Paxful Legit?
Security is a huge aspect of cryptocurrency; many people invest in it due to the anonymity and security it offers. Paxful is not regulated by any financial institution in any of the countries where it is available. Even though it is unregulated, Paxful still incorporates Know Your Customer (KYC) and Anti-Money Laundering (AML) systems to secure the marketplace.
For extra security measures, the site auto-generates a new wallet every time a user makes a deposit or a withdrawal, rendering hacking efforts useless. The multi-sig compatibility feature provides users with security options they might want to explore while setting up their wallets.
Users are also asked to set up two-factor authentication and provide ID verification to enhance security. This is especially important for frequent users or anyone looking to transact more than $1500.
One of the best features Paxful has is an escrow holding service that holds cryptocurrency until both parties finish trading. This move has helped to get rid of scammers who might be preying on genuine traders. The wallets are provided and secured by BitGo, the most popular and secure service provider in the crypto industry.
Paxful Platform and Features
A lot went into the Paxful design process, and some of these features have helped propel the platform to its fame today. What are some of these features? What drives 220,000 users to this platform every month?
Security Features
Paxful guarantees top-notch security to its users. By partnering with BitGo, a service provider synonymous with crypto wallet security, users can enjoy secure transactions worldwide. Paxful also offers an escrow service, which adds an extra layer of security to transactions.
Additionally, in order to verify the accounts created, Paxful has a rating system, like a verification badge on social media, to help users rate sellers and buyers they trade with. Combined with the escrow service, this rating system helps users to identify if the person they are dealing with is trustworthy.
User Interface
Paxful prides itself on a nearly seamless user experience, making crypto accessible even to beginners. The platform is available via a mobile app and a desktop trading app.
Whether you are using the web platform or the mobile app, the user experience is easy. To open a trade, users click on “New Order” to either place a bid or ask a seller to open a trade. Sellers can advertise their services to attract more buyers. They can even advertise on Paxful’s social media platforms.
Paxful Fees
Low transaction fees are an attractive feature in financial platforms, and Paxful boasts of some of the lowest fees on the block. There is a 1% service fee on withdrawals from the wallet to your bank account and zero fees when buying crypto.
Sellers enjoy a low 0.5%-5% selling fee on the Paxful app, making it one of the most affordable trading platforms.
Payment methods
Paxful offers its users different options to facilitate convenience as a leading cryptocurrency platform. Users can deposit and withdraw funds using Visa/ Mastercard, PayPal, Western Union, and even Amazon Gift Cards. In addition, users can use at least 300 payment methods, including wire transfers, online wallets, and credit/debit cards, to trade crypto on the platform.
Customer Support
Users can access customer service when they have issues or inquiries they need to be attended to. The customer support features an in-depth FAQ section that covers the most asked queries as well as constant monitoring of user accounts to prevent any problems.
Fees & Commissions
In comparison to other service providers, Paxful’s fees are among the lowest. Users can buy crypto for free, as charges only apply when selling. The amount charged per sale depends on the payment method the user prefers.
Fees typically range from 0.5% -5% when you use debit cards, 1% fee for e-wallets, and 3-5% for gift cards. There is also a 1% transaction fee charged when users transfer crypto from one Paxful account to another crypto wallet. Unlike some service providers, Paxful does not offer commissions for sales made.
Coins Available for Trading
The Paxful wallet focuses on three major cryptocurrencies but is looking to partner with Binance to increase accessibility to fiat currencies. Traders on Paxful can buy and sell;
- Bitcoin (BTC)
- Ethereum (ETH)
- Tether (USDT)
How to Open an Account
Step 1: Sign Up
This is the first step towards trading on Paxful. When you log onto the website and click ‘Sign Up’, a biodata form appears. Fill out the required details, including your name, address, phone number, country of residence, and more. When that is done, you will be redirected to the verification page.
Step 2: Verify the Account
Once you have fed in all the details, it is time to verify your identity. A verification link will be sent to the email address you provided, and you can verify that you are the one who is opening the account.
Step 3: Begin Trading
After verification, you can begin trading cryptocurrency using your preferred methods of payment. You can choose from PayPal, Western Union, Bank Transfer, Credit Cards, and many others.
One thing you need to know before you begin trading is that Paxful has four verification levels with trading limits. Users who are from the US need to complete at least 3 of the levels to trade, while those from the EU and Canada need at least three levels to make a withdrawal.
These levels are;
1: Email and phone verification. The limit is $1,000.
2: Level 1 requirements and ID verification. The limit is $10,000.
3: Level 2 requirements and address verification. The limit is $50,000.
4: Level 3 requirements and enhanced due diligence. No limit to this level.
Trading Cryptocurrency on Paxful
Here’s how to trade on Paxful.
Step 1: Log On
To trade, log onto the platform or mobile app, click ‘Buy Bitcoin’, and select one of the 300 payment methods you want to use.
Step 2: Shop Around for Deals
Browse the marketplace for a selection of offers until you find one that is suitable. Before making a trade, ensure that the person is a verified merchant to reduce the chances of being conned and losing your money.
In this regard, most buyers look for sellers with at least 200 ratings for their services. This is wise, considering that not all of the 87 thousand vendors might be genuine.
Step 3: Verify Identity and Trade
Once you verify the person you are trading with, type the amount of money required and press ‘Enter’.The money will be moved to an escrow account until the seller releases their crypto. Once they do, the escrow account releases the money from the escrow.
If you are using the app, the escrow account holds the money until the bitcoin seller sends the coins to you. This can take a while longer, but it is an assurance you will receive your cryptocurrency. Even beginners will find Paxful easy to use compared to different alternatives in the crypto market.
Customer Support
Paxful has a chat box feature that users can use to access the customer support desk for any requests. The reply is almost instant, and if not, a representative will send a follow-up email and attend to you. On the other hand, the platform has a rather detailed FAQ section that covers most, if not all, of the questions most users have.
The platform is built on a user feedback system that allows customers to leave feedback when they purchase crypto from a seller. These reviews give a new buyer some insight into whether the client is genuine or not, which is also another customer care-based approach to handling issues.
Paxful Alternatives
LocalBitcoins
LocalBitcoins is a crypto marketplace that was launched in 2012 and is one of Paxful’s biggest competitors. The site boasts of being in the industry longer, so many people find it trustworthy. The services offered are almost similar, except for the fact that LocalBitcoins has a wider portfolio of cryptocurrencies in comparison to the three offered by Paxful.
Gemini
Another competitor that is giving Paxful a run for its money and users is Gemini Exchange. Even though they are very similar in the services offered, Gemini has an edge due to its commission feature. Users can earn commissions when they make a certain number of sales, which is motivating.
Conclusion
Paxful has made a name for itself in the crypto industry. It is for a good reason. The site has a wide variety of currencies and cryptocurrencies to choose from. It is easy to access and use and is secure. That said, there are some reviews claiming there are a high number of scammers on the site, so new users are advised to proceed with some common sense. The platform can also work to improve customer service by perhaps introducing an email line or a live chat feature for faster access.
FAQ
1. What is Paxful?
Paxful is a peer-to-peer trading platform that allows people across the world to buy and sell Bitcoin and other cryptocurrencies.
2. Is Paxful Available in the US?
Yes, it is. Paxful is available in all US states except New York, Washington, and West Virginia. However, the Tether feature is also unavailable in Texas.
3. Is Paxful Legit?
Yes, it is. There are many complaints online about Paxful, but most of them are from people with banned accounts. When trading there, be on the lookout for scammers.
4. Is it Safe to Trade on Paxful?
Yes, it is. There are measures in place to ensure your wallets are protected from hackers.
5. Does Paxful have Commissions?
At the moment, Paxful does not offer commissions on crypto sales
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