The CEO of peer-to-peer cryptocurrency marketplace Paxful has announced that 88% of previously frozen user accounts will be unfrozen after suspending operations for more than a week.
In an April 16 Twitter post, Paxful CEO Ray Youssef said that after employees unfrozen 88% of existing accounts, about $4.4 million in frozen funds remained on the platform. According to Youssef, the unfreezing of the accounts was done "without engineers or compliance personnel," and claimed that all remaining frozen funds were "in the hands" of U.S. financial regulators.
Youssef said that while about 3% of user funds are still frozen, he has made the unfreeze a “last act” by the Paxful CEO: "I gave up my title of CEO to unfreeze these accounts while also being in contempt of court," Youssef wrote. "Other than many sleepless nights, this is what I did. All I could do was get a good night's sleep tonight .Integrity trumps risk."
The "contempt of court" charge may be related to ongoing litigation between Youssef and Paxful co-founder Artur Schaback, who helped launch the platform in 2015. Schaback claimed in court that the company was involved in misappropriation of funds, money laundering and tax evasion of U.S. sanctions. Youssef told Cointelegraph at the time that the allegations were “ridiculous.” The announcement follows Paxful user suspension on April 4. At the time, Youssef said there had been some “key staff departures,” citing “regulatory challenges” the platform faced. A few months ago, the CEO had authorized refunds for Earn program users affected by the Celsius debacle.
