3. February 2023

Paxful Delists Ethereum Citing PoS, Lack of Decentralization, and Scams

• Paxful, a peer-to-peer cryptocurrency trading platform, is delisting Ethereum.
• The move was announced by the platform’s CEO Ray Youssef, citing three main reasons for the decision: Ethereum’s move to a proof-of-stake consensus mechanism, a lack of decentralization, and the prevalence of scams in its ecosystem.
• The delisting will be effective as of 12:00 UTC, December 22.

Paxful, a popular peer-to-peer cryptocurrency trading platform, recently announced that it will be delisting Ethereum from its marketplace. The move was made by the platform’s CEO Ray Youssef and was first hinted at by Youssef ten days prior.

Youssef took to Twitter to make the announcement, and said that the decision was made with “integrity over revenue” in mind. He provided a screenshot of the statement he had sent to clients, which went into more detail about the reasons behind the move. According to Youssef, the three main reasons for delisting Ethereum from the platform were its move to proof-of-stake (PoS), a lack of decentralization, and the growing prevalence of scams in its ecosystem.

Youssef noted that PoS has “rendered ETH essentially a digital form of fiat,” and that it is the proof-of-work consensus mechanism in Bitcoin that makes it “the only honest money there is.” He also highlighted the fact that a small group of insiders still manages to exert a great deal of influence over the Ethereum project. Finally, Youssef pointed out that while Ethereum may have some utility in use cases such as lending and credit, it “thrives because of tokenization” and this has led to many scams that have cost people billions of dollars.

The delisting of Ethereum from the Paxful platform will be effective as of 12:00 UTC, December 22. However, the platform will still maintain stablecoins up for trades since these have “real use cases.” Youssef also called on other exchange runners to follow suit, and to take responsibility for protecting their users.