Paxful Review: Peer-To-Peer, Instant, Legit
Great for fast anonymous Bitcoin purchases. Due diligence required!
- Ease of use
- Prices & Fees
Paxful is a peer-to-peer online marketplace with a built-in escrow mechanism. Bitcoin sellers list the amount of BTC they are willing to sell and the payment methods they accept and Bitcoin buyers search and select the offer they are interested in. Both parties exchange payment details and then Bitcoin is released from Paxful escrow. The goal of the platform is to let users buy Bitcoin fast and at the level of anonymity they select themselves. Paxful does not collect personal data more than each individual Bitcoin seller would ask.
Anonymity of Paxful largely depends on the payment method you choose to use. If you select a debit card payment – naturally there is a way to trace your purchase if the card is issued to your name. If, on the other hand, you exchange a gift car for Bitcoin – there is practically zero chance the purchase will be tied to your name.
Paxful headquarters is registered in Delaware, USA, Ray Youssef being the CEO, you can view the company info on LinkedIn.
First and foremost – there is NO official Paxful app on Google Play. The one listed there as “Paxful” right now is a scammy imposter app from another manufacturer. The user reviews there indicate this is not an official Paxful app, but Google Play moderators take a while to purge it for some reasons:
As you can see there are two manufacturers having made a Paxful app each, none of them are Paxful:
There is also an app on websites called Appsgeyser and an Appypie, and none of them are official. It’s a bad idea to use any of those apps even if they are not malicious – do not compromise your Paxful credentials or wallet password.
Use the official Paxful website to avoid any confusion.
Paxful payment methods are what seals the deal with this marketplace. There are over 300 payment methods of varying degree of safety, privacy and reversibility. The fact that you can buy Bitcoin for practically anything on Paxful is why the exchange is growing more and more popular.
As an example, here is a quick list of all payment methods available for Bitocin purchases at the time of writing:
If this variety is not impressive then we do not know what is.
The fee structure is very simple at Paxful:
- the Bitcoin buyer has no fees payable to the Paxful platform
- the Bitcoin seller pays a 1% fee to Paxful
Even though there are no buyer fees, sellers set their prices as they please, so you will always overpay a bit to match the seller’s price. Most of the legitimate sellers on Paxful convert reversible payments into irreversible ones (i.e. fiat money into Bitcoin), which means they have to hedge against the risks. For instance, the seller will exchange your $100 gift card for $80 worth of bitcoin, $20 being your fee for a fast, direct and untraceable Bitcoin purchase.
All the info is clearly displayed in the Paxful knowledgebase.
Paxful is a peer-to-peer marketplace that simply matches people willing to buy and sell Bitcoin fast. You need to understand that there will be scammers on a site like that, but it’s easy to stay safe if you follow simple steps, including those listed by Paxful in their knowledgebase.
First, the danger of getting scammed mostly affects Bitcoin sellers, not buyers. Since most traditional payment methods (PayPal, debit & credit cards, even gift cards) are mostly reversible, a buyer can get his/her funds back in case of a mishap. The Bitcoin seller, on the other hand, will lose any access to the BTC they send out, since all Bitcoin transactions are irreversible. So if you are just using Paxful for a quick Bitcoin buy using PayPal, debit card, cash or any other payment methods they support – you have very little to worry about. It is mostly the sellers that are working with the risk of reversible payment methods.
With that said, here is the list of Paxful safety tips for sellers (read these too if you are a buyer!):
1) Instantly reversible payment methodsPayPal, Venmo, Chase QuickPay, Google Wallet, VISA/MasterCard/Amex
Use buyer ID verification and extreme security precautions while accepting these payment methods. Ask for a selfie with a state issued ID and a handwritten note with your, seller’s, nickname – something to prove neither the card nor the ID are stolen. A lot of Bitcoin sellers have been scammed on Paxful when they took customer vetting easy with these payment methods.
2) Most gift cards are reversible too, just with time limits (e.g. Amazon gift card is reversible within 45 days). Though gift cards are usually cheap and offer little reward for scammers, take these safety measures:
a) ask for a photo of the gift card with the code at the back;
b) ask for a photo of the cash receipt
c) ask them to write your username on the receipt
All that will prove that the card was bought with cash and has not been re-used.
3) In general, there are several warning signs if the user is unreliable:
a) he/she ignores your instructions and/or sends information you did not ask for.
b) high amount ($50+) gift cards used for bitcoin purchase without any purchase history (first time buyers will use $20-$30 gift cards)
c) he/she buys a very small amount of Bitcoin from you to establish trust and then comes back buying a MUCH larger ammount nearly immediately. Legitimate buyers rarely buy their first bitcoin twice in one week.
4) Check the Paxful forum for any reports on the user you are dealing with. No matter if you are a buyer or a seller, the feedback on the forum may give a lot of background on the person you are dealing with. Also, immediately report user to Paxful if you have been scammed or if you suspect you might be getting scammed. You can start a dispute too in order to bring the attention of Paxful moderators to your case.
Verdict. Is Paxful legit?
Paxful is legit and trustable as a marketplace with built-in security measures, ratings system and a vigilant community. However, the marketplace may host malicious actors before they get neutralized, that is why you need to be careful while trading and adhere to safety measures listed above.
The benefits of Paxful are that it gives an opportunity to buy bitcoin with either cash, debit or a credit card instantly and without any ID verification (the seller may and will ask you to prove yourself if you use a credit/debit card though). How long Paxful takes depends on the payment method you select, but most cash or gift card transactions are very fast.
Once you buy your Bitcoin and it’s deposited to your Paxful wallet make sure you withdraw it to another wallet where you control the private keys.