Nigeria Detains Binance Executives A Day After CBN Chief Said Suspicious $26bn Passed Through The Crypto Exchange
The Federal Government of Nigeria has reportedly detained two executives of Binance, the world’s largest cryptocurrency exchange with a market capitalization of $1.3 billion.
According to Financial Times, the executives, who flew to Nigeria following the country’s decision last week to ban several cryptocurrency trading websites, were detained by the office of the national security adviser, and their passports seized.
Neusroom research shows that peer-to-peer, a feature in Binance that allows users to trade cryptocurrencies using the local currency (naira), has now been disabled. This comes at a huge cost to about 35% of Nigerians aged 18 to 60 who actively trade or invest in Bitcoin and other cryptocurrencies as a means of income in a country where 88 million people live in extreme poverty with prevailing unemployment, particularly among the youth.
However, there have been several calls for crypto exchanges operating in the country to be regulated as a result of what the government called suspicious transactions.
Yesterday, February 28, 2024, Yemi Cardoso, Governor of the Central Bank of Nigeria, claimed that the country is concerned with the illicit flow of money through cryptocurrency exchanges.
“We are concerned that certain practices go on that indicate illicit flows going through a number of these entities [crypto platforms] and suspicious flows at best,” Cardoso said during the apex bank’s first Monetary Policy Committee (MPC) this year, where the interest rate was raised by 400 basis points—a move to slow the soaring inflation.
He added, “In the case of Binance, in the last one year alone, $26bn has passed through Binance Nigeria from sources and users who we cannot adequately identify.”
Nigeria, Africa’s largest economy, is witnessing one of its worst economic challenges, from inflation to exchange rate crisis, which has often been attributed to the ongoing economic reform by the administration of President Bola Tinubu.
To save the country’s currency from further depreciation, – having lost over 200 percent of its value in less than a year – the CBN has initiated several reforms, from clamping down on Bureau de Change operators to attempting to regulate crypto exchanges, some of which Bayo Onanuga, Spokesperson to President Tinubu, claimed are blatantly setting the exchange rate.
“We have saboteurs. Look at what Binance is doing to our economy. That is why the government moved against Binance. Some people sit down using the cyberspace to dictate even our exchange rate, hijacking the role of the CBN,” he said during an interview on Channels TV.
“They just sit down and fix anything they like. It’s sabotage, and we are trying to prevent that from happening henceforth.”
