Paxful
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anchored·5K7QYc…t3d7Summary
Paxful was a U.S.-based peer-to-peer Bitcoin marketplace founded in 2015 by Ray Youssef and Artur Schaback. After operating for a decade and processing approximately $5 billion in trades across 14 million users, the platform ceased operations by November 1, 2025, citing the lasting impact of historic compliance failures and unsustainable remediation costs. In December 2025, Paxful Holdings pleaded guilty to three federal criminal charges — including conspiring to violate the Travel Act, operating an unlicensed money transmitting business, and BSA anti-money laundering violations — and was sentenced in February 2026 to a $4 million criminal penalty; FinCEN separately assessed a $3.5 million civil penalty for the same underlying conduct.
Connected Entities
1 entities · 10 linked investigations- + 8 more
Timeline(18 events)
July 2015
Paxful founded by Ray Youssef and Artur Schaback as a peer-to-peer Bitcoin marketplace; begins operating without a registered Money Services Business license, AML program, or KYC requirements.
DOJ Sentencing Press ReleaseDecember 2015
Paxful begins knowingly processing Bitcoin payments on behalf of Backpage.com, an illegal prostitution advertising platform, according to DOJ court documents.
DOJ — Virtual Asset Trading Platform SentencedSeptember 2016
Co-founders Ray Youssef and Artur Schaback are arrested in Miami Beach following an incident involving an AR-15 rifle and drug possession (cocaine and hashish). Charges are later dismissed.
CoinDesk — Drugs, Erratic Dismissals and Feuding FoundersFebruary 2017
Ray Youssef is arrested in Tallinn, Estonia on suspicion of drug trafficking, allegedly for procuring MDMA and steroids via darknet markets.
CoinDesk — Drugs, Erratic Dismissals and Feuding FoundersApril 2018
DOJ seizes Backpage.com. Despite the seizure, Paxful allegedly continues processing payments to a Backpage copycat site for approximately four more years.
DOJ — Virtual Asset Trading Platform SentencedNovember 2018
Paxful designates its first compliance officer — approximately three years after beginning operations.
Paul, Weiss — DOJ and FinCEN Reach ResolutionsJuly 2019
Paxful implements its first written AML program — four years after founding.
Paul, Weiss — DOJ and FinCEN Reach ResolutionsNovember 2019
Paxful files its first Suspicious Activity Report (SAR) with FinCEN — more than four years after commencing operations.
FinCEN News ReleaseOctober 2021
Artur Schaback takes paternity leave; upon returning finds his access to company systems and credit card revoked, and his COO title removed by Youssef. Beginning of documented co-founder conflict.
CoinDesk — Drugs, Erratic Dismissals and Feuding Founders2023
Artur Schaback files suit against Ray Youssef and Paxful alleging wrongful termination, misappropriation of funds, money laundering, and alleged sanctions-evasion planning regarding Russia.
CoinTelegraph — Co-Founders LitigationApril 2023
Paxful temporarily suspends marketplace operations amid co-founder dispute and concerns about customer fund safety; a Delaware Chancery Court appoints a custodian.
CoinDesk — As Bitcoin Platform Paxful Closes8 May 2023
Paxful relaunches under new CEO Roshan Dharia after board structure is resolved.
CoinDesk — Paxful Marketplace Back Online8 July 2024
Artur Schaback pleads guilty in U.S. District Court, California, to conspiracy to fail to maintain an effective AML program. Agrees to pay $5 million in fines and cooperate with ongoing investigation. Faces maximum of five years in prison.
DOJ — Paxful Inc. Co-Founder Pleads GuiltyNovember 2025
Paxful ceases all operations by November 1, 2025, citing lasting impact of former co-founders' misconduct and unsustainable compliance remediation costs.
Paxful Blog — Wind Down Announcement9 December 2025
Paxful Holdings, Inc. pleads guilty in U.S. District Court, Eastern District of California to three federal conspiracy charges: Travel Act violations, operating an unlicensed MTB, and BSA AML violations. FinCEN concurrently issues $3.5 million civil consent order.
DOJ — Virtual Asset Trading Platform Pleads Guilty13 December 2025
Ray Youssef indicted in U.S. District Court, Eastern District of California, on charges of willfully failing to maintain an effective AML program, willfully failing to file SARs, and operating an unlicensed money transmitting business. Youssef is arrested and briefly detained in Santa Ana before being released under supervision.
BeInCrypto — Paxful Founder Indicted10 February 2026
Paxful Holdings, Inc. is formally sentenced by the U.S. District Court, Eastern District of California to pay a $4 million criminal penalty.
DOJ — Virtual Asset Trading Platform SentencedFebruary 2026
Ray Youssef departs as CEO of NoOnes, a separate P2P crypto platform he founded after leaving Paxful. NoOnes states his legal matters are personal and unrelated to the company.
TechPoint Africa — NoOnes Confirms Ray Youssef Is No Longer CEODecision Log
- hash: 2kpv9UbNHGg5PiaMXeyhKacbAJiYCCSXBAzTXx31rSMJ
This investigation is cryptographically anchored to the Solana blockchain (1 event). 21 of 21 cited source URLs have an Internet Archive snapshot.
model: claude-sonnet-4-6
generated: 6/2/2026, 7:17:01 PM
last updated: 7/26/2026, 4:25:40 PM
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