Former Paxful CEO Youssef Raises Concerns Over Removal of Proof of Reserves
The former CEO of Paxful Ray Youssef recently took to Twitter to declare a public warning about his former company. Youssef claimed that Paxful had removed the proof of reserves which previously provided transparency regarding the amount of cryptocurrency that is held in the exchange's wallets....
The former CEO of Paxful Ray Youssef recently took to Twitter to declare a public warning about his former company. Youssef claimed that Paxful had removed the proof of reserves which previously provided transparency regarding the amount of cryptocurrency that is held in the exchange’s wallets.
Request for Trading Pause and Emphasis on Transparency
Youssef encouraged followers to refrain from trading until the truth about this problem came to light in a tweet on July 8 . Youssef emphasized the significance of keeping complete openness on reserves during his term as the company’s CEO while making it abundantly clear that his comment was not intended to be financial advice . He said that it should be a simple procedure and expressed his disappointment at the elimination of such a key step .
The Proof of Reserves document serves as a means for cryptocurrency exchanges to display that they have enough funds to cover customer deposits and withdrawals. It plays a crucial role in preventing fraud, theft or potential bankruptcy . However according to Paxful’s help center the exchange no longer provides a link to the proof of reserve document on its website.
Paxful’s Response and Lack of Explanation
Youssef’s accusations remain unanswered and Paxful has yet to explain why the evidence of reserves was taken off. Youssef and Artur Schaback created the exchange in 2015 and it now has over 7 million customers and accepts more than 300 payment options . Users and professionals in the sector are now looking for explanations and reassurance regarding the exchange’s reserves due to Paxful’s failure to provide a formal declaration.
Paxful is under growing strain to fix the issue quickly and regain the trust of its user base as worries about the lack of transparency deepen . The removal of the evidence of reserves was not clearly communicated which raises serious concerns about the exchange’s dedication to openness and the protection of client cash.
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