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Ray Youssef of Paxful – Cointelegraph Magazine

Cointelegraph Magazine

“I’m coining this time period proper right here, proper now,” Ray Youssef declares. “Monetary Apartheid.”

The CEO and co-founder of Paxful is on a mission. “It’s what has held Africa again greater than the rest.”

“How superior would america be should you couldn’t ship cash from New York to Florida? From New York to California? From Oregon to Washington? It wouldn’t be america! It could be a large number of all these squabbling little city-states that may barely get it collectively.”

Youssef is keen about remodeling the world by enabling the free circulation of cash all over the place. This may solely be completed, he says, with a people-powered market.

“Cryptocurrency is only a piece. We use that as a expertise, but it surely’s the those that make it work. It’s peer-to-peer identical to Napster, Uber, Airbnb, Craigslist, all of it. That is the final piece wanted in order that expertise can actually disrupt finance.”

Bitcoin by itself, Youssef says, just isn’t sufficient.

Paxful values discovered on the newsstand

Youssef displays on his first job in Hell’s Kitchen within the 80’s, when New York was “a tough place.” He hauled enormous stacks of a whole bunch of newspapers, delivering to lodges round Central Park. “I used to be like eight or 9 years outdated, however I used to be a monster.” Lugging a hand truck of papers across the neighborhood, he would acquire as much as a thousand {dollars} in money by the top of an evening’s run. “That’s some huge cash for an eight yr outdated boy to be carrying round!”

His dad and mom labored continuous. Immigrating from Egypt, his father began out as a lowly dishwasher earlier than saving up sufficient cash for the household to hitch him in America. Finally, the dad and mom began a modest newsstand enterprise with just a little assist from some buddies, the place Youssef labored as a teller. “That’s the place I discovered the right way to deal with cash and deal with individuals.”

Youssef discovered to attach with individuals on the road. Staying related to on a regular basis individuals is a key worth that Paxful espouses, he says.

This worth continues to ring true for Youssef now, as his firm strives to construct for the wants of its customers. The tendency within the tech trade, he says, is to keep away from connecting with individuals on the road. However a profitable firm is open to studying in regards to the issues customers are experiencing and the place they need assistance.

One explicit occasion from his childhood informs his present function. Strolling along with his dad and mom in a crowded New York avenue, he remembers seeing a person drop a pockets, filled with a couple of thousand {dollars} in money. “A thousand bucks would have been an enormous boon to us on the time. However what did my father do? He picked up that pockets, and he ran after the man that dropped it…” The person merely thanked his father and walked away, however the second left an enduring impression on Youssef. 

“Honesty is primary. We’re within the cash enterprise. You must have individuals you may belief. My co-founder, Artur [Schaback], I belief him. He’s my brother. Greater than my brother. I by no means had an actual brother however Artur is my brother. We each love and respect one another and belief one another utterly. You want that on this enterprise.”

Constructing for the long run

He wonders what the present bullish sentiment would possibly do to new naive traders who’re testing the waters of crypto markets for the primary time. “What’s gonna occur after [the bull run] is the query. Are all of the retail traders gonna get burned once more?”

“Or are we really going to construct actual construction round this factor we love referred to as cryptocurrency, referred to as Bitcoin? To allow actual use-cases to occur?” Institutional cash will absolutely enter the scene, Youssef suggests, when use-cases are real and cryptocurrency isn’t just a speculative asset class.

Making that occur requires some severe hustle, he believes. Pointing once more to the legacy of his dad and mom, he discovered what it meant to work arduous. “My mom and father labored so rattling arduous. Eighteen hours a day can be a simple day.” As a youth, Youssef watched immigrants from Greece, Colombia, and from throughout Africa working continuous to seek out success in America. It was this aggressive hustle, a “maniacal drive,” Youssef says, that instilled the spirit of entrepreneurship in him.  

This identical fanatical ardour has carried over to Paxful, Youssef says, with the aim of constructing the perfect product group on this planet, targeted on customer support. Seeing how good his dad and mom had been with individuals, Youssef is striving to observe of their footsteps. “They’ll do this in a newsstand, we will do this in monetary companies.” 

The banks, he says, have forgotten this. They merely don’t care. “So right here we’re to care. Individuals actually admire that, particularly in the case of cash.”

Pondering his household’s legacy brought about Youssef to pause in a second of gratitude. “I can provide thanks now for these issues.” 

Failure to launch

Youssef skilled his justifiable share of failures earlier than discovering success with Paxful. Beginning with computer systems comparatively late on the age of 19, he discovered to code in various languages. He quickly developed proficiencies round architecting methods, constructing buildings and integrating with merchandise. Along with his newfound expertise, he started on the lookout for issues to resolve.

His first resolution to garner consideration centered on ringtones with a startup referred to as MatrixM, “the Napster of ringtones.” Youssef single-handedly constructed a peer-to-peer service the place customers might add ringtones and ship them to different customers through SMS. 

“It blew up in a single day,” Youssef explains. The service generated 1,000,000 {dollars} in revenues after a mere six months of existence.

“It was an enormous success and I used to be the one man within the firm! I constructed the entire thing myself. All of the code.” Youssef shared the success along with his mom, shopping for her a house in New York with the cash he made. However a lingering downside remained. Music publishers weren’t too eager to see outdoors events getting a chunk of the profitable motion. Even with what appeared to Youssef like a really beneficiant provide, publishers refused to cooperate, insisting on being paid each single time the ringtone would go off on a person’s machine.

“That’s what I went up towards in my youth. It was a tough lesson.” 

Together with various different startups that fizzled out, this disappointing failure turned Youssef off expertise for some time, throughout which he says he “went insane,” working away from his troubles and turning to a nomadic life-style, boxing and fascinating in MMA in addition to touring all through Asia visiting and praying at each temple he might discover alongside the way in which.

“My one large mistake was that I didn’t ask for assist. I used to be a one-man military and I used to be so pleased with that, and so pleased with how sensible I used to be. I used to be smug. I couldn’t ask for assist and correctly scale.”

Since then, Youssef says, he has discovered to be extra humble and to just accept assist. “God has damaged me,” he says. He admits he’s very cussed, so the change to a extra humble outlook took some convincing.

“Pharoah is a good instance [of stubbornness]. How lengthy did he defy the God of Moses and Abraham earlier than he lastly bought the message? Solely when he was drowning. However God was extra light on me. I got here to a degree the place I needed to ask God for assist and I bought it.”

Simply six years in the past, Youssef and Paxful co-founder Schaback had been homeless for a interval of about two months, bouncing from sofa to sofa and residing on the streets. Generally, Youssef confesses, he would spend nights wandering aimlessly round city. After so many startup failures, he had burned by means of all of his life financial savings and “felt like a loser.”

Nonetheless, he was motivated to press on by the need to offer for his mom, he says, returning to the sport to be able to get his mom one other home after a divorce. Youssef returned to constructing startups, specializing in file-sharing expertise whereas additionally writing blogs on well being and pure philosophers. The lacking hyperlink in each single earlier startup, he explains, was at all times the issue of funds. Funds, Youssef says, is the final main barrier, however it may be overcome with cryptocurrency expertise.

In 2013, Youssef began listening to extra about Bitcoin and was interested in its potential for serving to individuals. He notably noticed the potential for cryptocurrency as a software to assist individuals in Africa. Bonding with Schaback at a Bitcoin assembly in Manhattan, the pair quickly began working collectively, creating a degree of sale Bitcoin service provider software referred to as EasyBitz. Regardless of Youssef’s newfound enthusiasm, it didn’t get a complete lot of traction, at first. It wasn’t fixing an issue anybody had on the time. 

Constructing Paxful

Youssef and Schaback finally created Paxful, pivoting with EasyBitz towards offering a peer-to-peer financing platform for buying and selling Bitcoin. The aim was to make exchanging worth simpler and extra accessible for everyone, from companies to people. 

He’s grateful for the life classes which have introduced him right here. “I wanted all of that. I actually did. Each single a type of taught me one thing. A few of them taught me about advertising. Some taught me about positioning. Some taught me about technical challenges, architecting, sharing with individuals, however virtually all of them had been peer-to-peer ultimately, very a lot oriented round individuals.”

Now, Youssef explains, Paxful can do one thing actual as a result of “We will contact cash. That’s what blockchain has given us.” 

Blockchain frees the monetary system from what Youssef sees as an oppressive and unjust regime. “That is just like the final boss. Central banks, the monetary system: it’s warped, damaged, closed off, compartmentalized, segregated. Principally, it’s below a regime of monetary apartheid.”

Pax Africana

In Africa, Youssef explains, sending cash from one nation to a neighboring nation is a nightmare, as Steve Msoh demonstrated earlier this yr in a function for Cointelegraph Journal.

It’s simpler, in truth, to move your self, he says. This legacy of Imperialism may be traced again to the 1400’s, with foreign money that is still below the management of colonial powers like France. Nations all through Africa to today shouldn’t have a sovereign cash system (as Akon famous, in his personal Journey in Blockchain), forcing unjust limitations on individuals all through the continent. 

African cash, Youssef says, just isn’t handled like cash from different components of the world. It’s closely scrutinized and far more susceptible to destabilization. “They’re used to it however after I hear about it, it’s like, that is diabolical stuff. It truly is.”

“That is what we’re doing. It’s a campaign towards monetary apartheid.”



Led by Paxful, Pax Africana is an initiative funded by means of the charitable BuiltWithBitcoin Africa Fund. To advance Africa’s economies and produce them to the worldwide stage, Pax Africana embraces priorities akin to streamlining interoperability between cash networks, and enabling intracontinental funds and remittances. Thus, the initiative “reaches the lots,” providing a connection to what Youssef describes because the golden circle of finance: the West.

The initiative additionally supplies for the constructing of sustainable water provides. With one undertaking already in-built Rwanda and one other underway, in addition to progress on a 3rd in Kenya, Paxful plans to clone the sustainable water provide methods throughout the continent. Youssef hopes that this may present secure, clear water to thousands and thousands and can enable youngsters to attend college as an alternative of spending as much as six hours of their day touring to fetch water. “Wouldn’t that be an enormous boon to the GDP of Africa? That might make such a distinction.”

BuiltWithBitcoin funds may also be used to construct faculties all through the continent, with plans to assemble 100 faculties. The aim just isn’t solely to construct the colleges, however to offer upkeep and upgrades akin to kitchens, clinics, sports activities fields, photo voltaic panels, and tablets. The grand opening of a college in Kenya is due for September, Youssef says.

Along with the basic financial wants of cash transferral, water and faculties, Paxful funds incubators; locations of upper studying and funding in entrepreneurs. Africa’s best pure useful resource, Youssef says, is its individuals; their heads and their hearts. He explains the continent of greater than a billion residents accommodates thousands and thousands of unemployed geniuses, providing an immense alternative and potential for development.

Pax Africana presents Africans the chance to hook up with the world by means of the Pax Citizen program. Youssef envisions villagers having fun with entry to telephones with free knowledge, messaging companies and verifiable identification. This “citizen equipment”, Youssef explains, opens the world to Africa’s individuals. “That’s what you have to be a citizen on this world. You want a cellphone. You want knowledge. You want some sort of verification ID. If in case you have these items, Increase! You’re on the map.”

Persevering with the campaign

There’s an expectation in life that we construct on our careers. Youssef is a first-rate instance of somebody who has actively constructed his character.

From the smug one-man military behind the failed MatrixM startup to a extra humble chief who depends upon the success of the individuals round him, Youssef acknowledges each his previous flaws and the work he continues to place into his life.

To additional deal with the problems of ‘Monetary Apartheid’, Youssef explains that Paxful is launching the Peer-to-Peer Alliance, by which members donate to BuiltWithBitcoin and share knowledge quantity. The aim of the alliance is to extend transparency in finance, notably amongst OTC, centralized and decentralized exchanges. “That is what humanity wants,” Youssef explains, “To construct collectively.”

Youssef displays on his non secular life, citing a return to his religion as a key to success. “What I want each single day is, I want to hope. I pray daily.” The thoughts grows weaker with out prayer, he says, as the burden of the world weighs us down, particularly throughout tough occasions. On daily basis, he says, your soul must recharge.

“Issues are going to get nice for us,” Youssef insists confidently, “The world goes to enter right into a golden age, however we’re going to be hit by extra of those challenges like COVID. We simply have to remain robust by means of all of it. It’s going to move. And the purpose is, we’re nonetheless constructing by means of all of it.”


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