In a recent development, Nigeria has intensified its scrutiny of cryptocurrency exchanges by detaining two senior executives from Binance, a major player in the crypto industry. Their passports were confiscated upon arrival in Nigeria, following the country’s decision to ban several crypto websites.
The crackdown stems from Nigeria’s telecommunications regulator instructing telecom firms to block access to platforms like Binance, Coinbase, and OctaFX, aiming to curb crypto speculation activities. This move is part of broader efforts to address currency instability, with the Nigerian naira facing frequent declines against the US dollar.
Bayo Onanuga, a special adviser to President Bola Tinubu, voiced concerns over the potential economic impact, stating, “We were told that, if we don’t clamp down on Binance, it will destroy the economy of this country.”
In response to the detention of its executives, Binance halted trading of the naira against bitcoin and tether digital coins on its platform.
During a recent press conference, Nigeria’s central bank governor, Olayemi Cardoso, highlighted the bank’s concerns about “suspicious” flows passing through crypto exchanges, singling out Binance. He cited $26 billion passing through Binance Nigeria in the past year from sources and users that cannot be adequately identified.
Authorities in Nigeria, including the anti-corruption agency, police, and national security adviser, have launched a joint probe into crypto exchanges, requesting a list of all Nigerian-based Binance users since the exchange’s establishment.
Despite regulatory challenges, Nigeria has shown significant awareness of cryptocurrencies, surpassing the US and European countries. According to ConsenSys, 99% of Nigerians were fully aware of cryptocurrencies last year, with 70% possessing an understanding of blockchain technology basics.
This awareness persists despite the government’s ban on digital asset ownership in 2021 and its subsequent introduction of the Central Bank Digital Currency (CBDC), the e-naira.
