Peer-to-peer Bitcoin marketplace, Paxful has announced that it will no longer offer its services in Venezuela.
The announcement came via a video tweeted by Paxful’s Latin American account yesterday.
The P2P marketplace said it was ceasing operations because ‘increasingly strict regulations’ hampered its ability to provide services to Venezuelans.
And according to the announcement, the decision was based on US sanctions imposed on Venezuela, which has made it very difficult to do business there.
Paxful Ceases Operations in Venezuela
Paxful users in Venezuela have 30 days to withdraw their funds free of charge, but Venezuelans living abroad will still be able to continue buying and selling Bitcoin on the Paxful marketplace.
‘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.’
The sanctions imposed by the US government and the difficulty the Venzuelan authorities have made trading Bitcoin in the region has denied Paxful one of the major emerging markets.
Paxful CEO Ray Youssef said ‘Venezuela’s rampant inflation, unbanked population and high mobile phone usage have long appealed to company.’
However, those attractions weren’t enough to overcome the complexities of operating in an economy as sanctioned and scrutinized as Venezuela’s.
It’s Getting More Difficult for Venezuelans To Buy Bitcoin
Buying Bitcoins is slowly but surely proving to be more of a challenge for Venezuelans.
The move to stop operations in Venezuela altogether comes just a few months after Paxful informed its customers that it would no longer support transactions made via the Bank of Venezuela.
Another move necessitated by US sanctions, according to Paxful.
And if Paxful’s decision wasn’t bad enough for the victims of one of the least functional governments and economies in the world, the people there are slowly having access to Bitcoin cut from every possible angle.
Just a few days before the news that Paxful would no longer be open in the country, the Venezuelan government blocked user access to US exchange Coinbase, and fiat remittance platform MercaDolar.
And over the last couple of years Venezuelan authorities have shut down many cryptocurrency exchanges, ordering them to suspend operations as part of a crackdown against the growing Bolivar/Bitcoin market.
So, it’s believed that as of now only, P2P marketplace LocalBitcoins, and exchanges Binance and KuCoin are the only way Venezuelans can legitimately buy Bitcoin.
Although there are other government-approved alternatives for Venezuelans to buy Bitcoin, these aren’t popular with the people of Venezuela due to a lack of privacy.
Venezuelans Will Fall Further Behind
As if the problems of living with arguably the most corrupt and inept government on the planet wasn’t bad enough, knowing that your most accessible way out of hyperinflation is being strangled must be distressing for the long suffering Venezuelans.
The government is a laughing stock, and has tried to convince its people to accept its new cryptocurrency, Petro, but the people know only too well if the rest of the world isn’t going to accept it, it’s worthless.
While there are still avenues for Venezuelans to buy Bitcoin, they are slowly eroding, and although there will always be a black market, Venezuelans will likely pay a higher premium than they already are on marketplaces like Paxful and LocalBitcoins.
Author: Tommy Limpitlaw
A Bitcoiner since 2017 and a Bitcoin Maximalist since 2018, Tommy is our main writer and editor at Bitcoin Maximalist. Other than researching and writing about Bitcoin, Tommy loves spending time with his family and supporting his beloved Leeds United.