Peer-to-peer Bitcoin exchange, Paxful has sent notice to its customers that it will no longer offer its services in Venezuela.
The company’s decision to cease operation in the country, which leads the Latin American region in terms of crypto volumes, was apparently related to sanctions imposed by the United States on Venezuela.
Paxful users in Venezuela have 30 days to withdraw their funds free of charges. However, Venezuelan traders who have completed address verification that confirms they are living abroad will be able to continue trading on Paxful.
“Our mission is to help the four billion unbanked and underbanked around the world and we’re truly heartbroken that we aren’t able to extend this calling to the people of Venezuela for now. We made our best efforts for several months but with concerns regarding the regulatory landscape, we had no choice but to make this incredibly difficult decision,” Paxful said.
Trading Is Not Entirely Prohibited for Venezuelans
The P2P Bitcoin exchange informed its customers back in June that it would no longer support transactions made via the Bank of Venezuela. At the time, Paxful stated that any customers making trades through the state-owned lender would see their accounts deactivated. The move, the company said, was necessitated by the need to comply with directives issued by the US Office of Foreign Asset Control.
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Venezuela already tops a list of sanctioned and high-risk states. Although trading is not entirely disallowed for its citizens, those using Paxful in the country must verify their identities to prove that they are not individuals targeted by sanctions.
Thus, Venezuelans using other banks were still able to use the platform after they had undergone a rigorous KYC process.
Aside from Paxful and the similar P2P exchange LocalBitcoins, Binance and KuCoin were among the few cryptocurrency exchanges serving users in hyperinflation-ridden Venezuela.
Paxful’s move comes a few days after the Venezuelan government blocked user access to US exchange Coinbase and MercaDolar, a fiat remittance platform.
Furthermore, Venezuelan authorities shut down many cryptocurrency exchanges over the last two years, ordering them to suspend operations as part of a crackdown against the growing bolivar-to-bitcoin market.