Paxful, a peer-to-peer virtual asset trading platform, has been fined $4 million after pleading guilty to multiple federal offenses, including promoting illegal prostitution and violating the Bank Secrecy Act. The U.S. Department of Justice announced the penalty following Paxful's admission of facilitating transactions for criminals and failing to implement anti-money laundering (AML) controls. From January 2017 to September 2019, Paxful facilitated over 26.7 million trades worth nearly $3 billion, generating $29.7 million in revenue. The company knowingly transmitted funds derived from criminal activities, including fraud and human trafficking, and transferred virtual currency on behalf of Backpage, a site involved in illegal prostitution. Despite an agreed penalty of $112.5 million, Paxful's financial capacity limited the fine to $4 million. The resolution was part of a coordinated effort with the Financial Crimes Enforcement Network (FinCEN). Paxful's co-founder, Artur Schaback, also pleaded guilty to related AML violations in July 2024.