Nigeria Detains Two Senior Executives of Binance

Binance is an online exchange where users can trade cryptocurrencies. The news that at least two senior executives of this online exchange platform have reportedly been detained by the Federal Government has taken the country by surprise.

The Financial Times claimed that after a ban on the Binance website, the two executives took a plane into Nigeria last week. There, they were detained and had their passports confiscated by National Security Adviser office officials. According to a person with knowledge of the situation, the authorities have been requesting to see a list of Binance’s Nigerian users ever since the company launched. They further asserted that using the internet platform in Nigeria was prohibited.

Nigerian Government Clamp Down On Binance For Having a Hand In Naira Devaluation

Among the world’s biggest peer-to-peer cryptocurrency markets is Nigeria. According to Chainalysis, the total value of cryptocurrency transactions in the nation between July 2022 and June 2023 was $56.7 billion. However, the Securities and Exchange Commission declared in June 2023 that Binance Nigeria Limited, a Binance subsidiary, was operating unlawfully.

The arrest occurred during government efforts to suppress naira speculation by targeting cryptocurrency exchanges.

To stop what it views as ongoing manipulation of the foreign exchange market and unlawful money transfers, the Nigerian Communications Commission, acting on behalf of the government, recently blocked the online platforms of Binance and other cryptocurrency companies. The naira’s value in relation to other currencies was allegedly collapsing as a result.

Furthermore, it dispatched agents from the Economic and Financial Crimes Commission to apprehend Bureau De Change operators located in Abuja’s Popular Wuse Zone 4.

Binance Effect On Naira In The Foreign Exchange Market

Notwithstanding Binance’s pledge to work with regional regulators, remarks made on February 27 by Governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, indicated that Nigerian authorities are still attributing the naira’s decline to the exchange’s operations.

“We are concerned about certain practices that seem to point to suspicious flows at best and illicit flows passing through several of these entities [crypto platforms].” Regarding Binance, $26 billion has gone through Binance Nigeria in the past year alone from users and sources that we are unable to positively identify,” the governor of the CBN stated.

According to Cardoso, an investigation into cryptocurrency exchanges is being carried out by the nation’s anti-corruption agency in coordination with the police and the office of the national security advisor.

Nigerian Government’s Reaction To Naira Devaluation

The presidential spokesman, Bayo Onanuga, emphasized that “although the government has taken strong action against the website, the saboteurs exploited cyberspace to control even our exchange rate, taking over the CBN’s function.”

Speaking on Channels Television’s Politics Today program on Wednesday, Onanuga declared, “Binance will destroy this country’s economy if we don’t clamp down on it.” All they do is adjust the rate.

“There are sabotage artists among us. Observe the impact Binance is having on our economy. The government took action against Binance for this reason. Some individuals take over the role of the CBN by sitting down and using the internet to control everything, including our exchange rate. We are working to stop this sabotage from occurring in the future.”

He finally predicts that once the CBN stabilizes the currency rate, the nation’s prices for goods will return to normal. “Over the next few weeks, things will get better—they won’t get worse,” he said.