TechFlow news, December 11 — According to Decrypt, peer-to-peer Bitcoin exchange Paxful Holdings Inc. has agreed to plead guilty to federal charges and pay a $4 million criminal penalty to the U.S. Department of Justice, along with a $3.5 million civil penalty to the Financial Crimes Enforcement Network.
The Department of Justice alleges that between 2017 and 2019, Paxful facilitated approximately $3 billion in transactions, generating over $29 million in revenue, while knowingly enabling criminal activities. The platform processed nearly $17 million in Bitcoin transactions directed to illicit websites such as Backpage, yielding at least $2.7 million in profits for Paxful. Additionally, Paxful facilitated transactions involving sanctioned countries including Iran, North Korea, and Venezuela, processing more than $500 million in suspicious activity.
The company deliberately avoided compliance controls and failed to identify customers or report suspicious transactions. Artur Schaback, Paxful’s co-founder and former Chief Technology Officer, pleaded guilty in July 2024. Sentencing is scheduled for February 10, 2026.
