Ray Youssef, the co-founder of Bitcoin marketplace Paxful, has assured creditors that the platform is under the supervision of a custodian and he will not ‘run off’ with the funds.
Paxful declared two weeks ago that it was ceasing operations while uncertain if the platform would ever reopen.
Paxful has 3.3% of Customer Funds Frozen
According to his Twitter thread, Ray Youssef will step down as Paxful’s CEO on April 18. He noted,
“The company is in the care of a custodian, which is a respected Delaware law firm. I now report to them at least until I resign tomorrow.”
He reiterated that the custodian now controls all funds and operations.
The CEO also observed that Paxful still has $4.4 million in frozen funds. It comes to around 3.3% of all customer funds that can’t be withdrawn.
He also assured the creditors that “Ray’s not running off” with the money because doing so would “destroy his reputation.”
But as his “final act as CEO,” Youssef also disclosed that 88% of all frozen accounts had been unfrozen after ten days of labor. That said, he advocated for self-custody for all crypto users.
The soon-to-be-former CEO claimed that he has “no power” to unfreeze 12% of the accounts that are still locked. He claimed,
“I have no access and have never had access to customer funds. Avoid U.S. companies and always self custody!”
The executive further stated that he is “in danger of being in contempt of court” by unfreezing the accounts. In addition to having many restless nights, he remarked, “Nothing more I can do but sleep well tonight. Integrity trumps risk.”
U.S. Legislative Crossfire Could Burn Crypto
The marketplace had stated that it facilitated customer withdrawal as soon as it announced its shutdown. With almost 11 million users, Paxful was a large peer-to-peer crypto trading platform.
Its closure coincides with U.S. regulators’ increased scrutiny of the cryptocurrency industry and the final winding down of the FTX disaster.
Meanwhile, Congressman Warren Davidson has introduced new legislation as political opposition to the U.S. Securities and Exchange Commission (SEC) grows.
The Ohio Representative announced that he wants Gensler removed from his role since the agency had overstepped its bounds in the crypto sector.
Hester Peirce, a member of the SEC who is dubbed “crypto mom,” also slammed the agency in a statement on Friday. She said,
“Rather than embracing the promise of new technology as we have done in the past, here we propose to embrace stagnation, force centralization, urge expatriation, and welcome extinction of new technology.”
Peirce fired the SEC for ‘solving problems that do not exist’ while applying a broad interpretation of the legislative meaning of “exchange.”
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