Nigeria’s federal government has formally requested information from Binance regarding its top 100 users in the country, along with their transaction histories for the past six months. This request comes as investigations into allegations of currency speculation continue for the third consecutive week.
The government’s demand for details on individuals engaged in trading activities forms a pivotal part of ongoing negotiations between the federal government and the cryptocurrency exchange.
Binance has been under scrutiny over its suspected involvement in speculative attacks against the Naira, which has experienced significant volatility against major currencies, particularly the US Dollar, in recent times amidst currency devaluation concerns.
Reports from the Financial Times indicate that the Office of the National Security Adviser is also urging Binance to settle any outstanding tax obligations to the federal government incurred during its operations in the country.
Nigeria has intensified its focus on Binance and other cryptocurrency platforms as part of efforts to mitigate its worst economic crisis in three decades and restore public confidence in its currency, which has faced considerable challenges.
In response to the currency manipulation allegations, security agencies, in collaboration with officials from the Securities and Exchange Commission (SEC) and the Central Bank of Nigeria (CBN), have taken measures such as blocking web access to cryptocurrency exchanges and detaining two Binance executives who were in Abuja for discussions on the matter.
Following the dispute, Binance has removed the Naira from its trading options on its platform.
Reports suggest that the detained Binance executives are being held at a guest house in Abuja, adjacent to the Office of the National Security Adviser, with their phones and passports confiscated since their detention. They were only able to establish contact with Binance on March 5, 2024, a week after being detained, and as of now, they have not been formally charged in court.
The federal government obtained permission to detain the Binance executives for 14 days, a period that expired on Tuesday, according to the Financial Times.
The crackdown on Binance follows ongoing investigations into the country’s foreign exchange market, which has reportedly suffered from distortions, manipulations, and speculations, leading to the continued depreciation of the Naira against major currencies, particularly the US Dollar.
Speaking at the recent Monetary Policy Committee (MPC) meeting, CBN Governor Mr. Olayemi Cardoso defended the central bank’s actions against cryptocurrency platforms, particularly Binance. He cited concerns over speculative activities against the Naira and highlighted the platform’s role in facilitating transactions amounting to $26 billion in 2023, which could have implications for monetary policy, including inflation and currency stability.
Cardoso emphasized the need to protect Nigerians from the disruptive activities of crypto platforms and affirmed the collaboration between the CBN, the Economic and Financial Crimes Commission (EFCC), the police, and the Office of the National Security Adviser to address these concerns and prevent market manipulation.
“We will do everything possible to prevent any of these kinds of infractions from taking place,” Cardoso stated.
