April 23 (Cointime) - Paxful co-founder Ray Youssef has announced his resignation as CEO and his plan to make Paxful users whole through a public trust.

According to the post, Srinivas Raju has been appointed by court order to be the custodian of Paxful and will hold full authority and control of the company, its operations, and its management while preparing recommendations for Paxful's future as a business.

"Currently, my co-founder and I are in a deadlock around the direction of the company. Given his track record, I do not trust him to have access to or control over user funds. We agreed to have Srinivas Raju, of Richards, Layton, and Finger (appointed by court order) to be the custodian of Paxful through this process." said Ray Youssef.

In addition, Youssef was able to unfreeze 88% of the frozen user funds over the weekend, leaving only 3.3% of total customer funds remaining on the Paxful wallet, a sum of just under $4.5M.

Youssef will put 99.9% of his personal shares in Paxful, which accounts for over 45% of the company, into a public trust. The funds generated by his shares will be used to make every Paxful user whole, and anything remaining will go directly towards the Built With Bitcoin Foundation to build schools.

Youssef had previously offered a deal to his co-founder to buy all his shares in Paxful for one satoshi in exchange for the co-founder's promise to do the compliance work necessary to unfreeze the remaining accounts. However, his co-founder refused the deal, leading Youssef to come up with this new plan. 

Youssef has committed to staying true to his word and maintaining the trust he has established with the Paxful community. He stated:

"I want Paxful to be an example of how a bitcoin company was faced with suffocating U.S. regulations and a greedy and selfish bad actor, but still overcame. We rolled up our sleeves and did whatever it took to make the users we care about whole."