Paxful is a cryptocurrency exchange founded in 2015 to serve as a marketplace for Bitcoin buyers and sellers. Paxful is a peer-to-peer platform, which means it is not a Bitcoin merchant or a centralized exchange. It merely serves as a middleman between buyers and sellers. See Paxful Login Guide.
Paxful’s founder had a vision of a world where everyone could access finance using crypto as the medium. BuiltwithBitcoin is the company’s philanthropic foundation established in 2017. Its mission is to fund charitable projects in African countries like Ghana, Nigeria, Kenya, Rwanda, and Uganda.
Paxful offers two platforms for users to access its services:
- Web interface
This platform is comparable to previous trading platforms, but its P2P service has taken to a whole new level. Buyers and sellers participate in various ways using these web-based platforms. The web interface automatically searches for the best offers for their trades based on customer preferences.
- Mobile Interface
Paxful’s mobile interface allows traders to buy and sell cryptocurrencies. This mobile interface is used as a wallet by traders with the same functionality as the web application. Paxful app is available for Android and IOS users with a review of 3.1 and 3.6, respectively.
Withdrawals and Deposits
Paxful does not charge a deposit fee. The platform accepts 350+ payment options for account funding, including Kenya’s M-Pesa payment system. Payment methods available in Kenya for Paxful include
- Domestic and international bank transfers
- Digital currencies, such as Litecoin and Dogecoin
- Goods and services, such as gold, vehicles, and gaming items
- Gift cards – Amazon, Google Play, and Xbox gift cards
- Online wallets – VISA Debit/credit cards, PayPal, Zelle, Google Pay, and M-Pesa
Although Paxful wallets are free, withdrawal fees apply. Bitcoin is transferable from internal and external cryptocurrency wallets, including Binance. Transaction fees for external wallet transfers vary based on the size of the withdrawal. A $20 withdrawal amount or more attracts 0.0004 BTC. Withdrawals from an internal wallet are subject to fees based on the corresponding limits. There are no fees for amounts up to $1,000 each month, after which a fee of 1% is eligible.
A 0.5% fee applies to all cryptocurrency conversions. Paxful does not charge to buy cryptocurrencies, but other customers and account owners who offer Bitcoin purchases establish an exchange cost.
When selling cryptocurrencies, transfer costs vary with the payment method. The lowest fee is 0.5% for bank transfers. A 1% fee applies to other payment methods such as debit cards, digital currencies, and online wallets. With a rate of 5%, the gift card rate is the most expensive way to trade cryptocurrency. Once a trade is complete, an escrow network charge is withdrawn from a vendor’s wallet and credited to Paxful.
Rates and margins
The vendors decide on the margin. Paxful considers it a seller charge rather than regular leveraged trading, and it can range from 5% to 50%. Before accepting an offer, investors might evaluate the vendor’s terms and conditions or look for an alternative that satisfies their pricing needs.
The website and mobile app both have an online contact form and a live in-site chatbot. Email addresses for customer service are available.
Paxful also has a comprehensive FAQ website and support center. How to create a Paxful account, ID verification, buying Bitcoin, and global language settings are all addressed in the FAQ. Twitter and other social media channels also provide up-to-date news and customer support.
Security and wallets
Peer-to-peer trading has the potential to create an unequal market environment. Some websites question if Paxful is legitimate or not and warn of PayPal scams. The best approach to ensure fair trade is to keep transactions within the marketplace to retain dispute and escrow protection.
The Paxful BitGo wallet service provider guarantees high-tech security safeguards to keep customer assets safe. 2FA for account login, 3D secure payments integration, and dual-factor code requirements for all crypto transactions are all part of this.
How Paxful P2P works
Clients must complete mandatory registration procedures to register a live account, including ID verification for certain countries. Additionally, if your volume or wallet activity reaches certain thresholds, you may be required to conduct KYC identity checks, including video verification and security questions.
Limits on requirements based on verification level:
- Level 0 – There is no requirement for verification. There is no limit on the number of trades.
- Level 1 – The mobile level where there is a $1,000 restriction per trade
- Level 2 – Email and identification. $10,000 per trade, with a lifetime cap of the same amount
- Level3 – The address verification is the third level. Each transaction limit is $50,000
- Level 4 – Extensive due diligence. Each trade is worth at least $50,000
Here is the rest of the trading process at Paxful:
- Paxful will generate a free wallet for you after creating an account. Choose your desired payment method: wire transfers, credit cards, PayPal, MasterCard, or M-Pesa for Kenya crypto users.
- Search for available Bitcoin sellers, and be sure to provide your desired currency and payment method. Open orders show in the search results, and you can click on one to select a specific seller.
- Following your selection of a preferred seller, you will be able to examine their profile and decide whether to proceed with the purchase. You can even chat with the seller directly through the platform.
- After starting the purchase process with the seller, the redirection will take you to an Escrow service. The service will walk you through the next steps depending on the payment method of choice.
Tips on how to conduct smooth trades in Paxful
- Verify your account
In most reviews, users claim Paxful scammed them because they received a huge payment and could not transact. Users should verify their accounts to lift transaction limits.
- Deal with trusted merchants.
Users should only trade with persons with a good reputation, which their ratings can determine. Paxful uses thumbs-up signs to show a confirmed trader.
- Do not release your crypto until the payment is complete.
There is an escrow system in place at Paxful. If you’re selling Bitcoin, Paxful will hold them until the transaction is complete. You won’t be able to reverse this unless the buyer fails to pay, respond, or closes the trade.