The Nigerian Government is seeking billions of dollars from the cryptocurrency exchange, Binance, amidst a foreign exchange crisis. The government alleges that Binance has established an unofficial exchange rate in the country and has contributed to the ongoing economic disruption in Nigeria.
According to a tweet by Nigerian spokesperson Bayo Onanuga, the significant trading volume of Binance in Nigeria has played a role in exacerbating the financial crisis. Yemi Cardoso, Governor of the Central Bank of Nigeria, stated that approximately $26 billion in untraceable funds have exited the country over the past four years via Binance Nigeria. In response to this crisis, the Nigerian government is attempting to limit capital outflows to prevent further funds from leaving the country. Although no definitive fine amount has been set for Binance yet, Onanuga suggested that penalties could reach up to $10 billion for damages caused.
Onanuga clarified his statement in an interview with The Gazette: "I said our government may impose heavy fines on Binance for what happened," he said. "I never stated that Binance had been informed about the fines or that it would definitely be $10 billion. I only mentioned that such an amount might be imposed because nothing has been finalized yet." The government alleges that Binance has been determining the exchange rate for the Nigerian currency naira, despite this being an authority reserved solely for the central bank. A report by Coindesk suggests that the crypto exchange's operations have contributed up to 70% of currency depreciation and highlights that the company is not registered to operate within Nigeria.
Amid escalating tensions between Binance and Nigeria, two executives from Binance were detained by Nigerian authorities upon their arrival in the country. CoinDesk reports that these individuals were held by the Office of National Security Adviser and their passports temporarily confiscated. While formal charges have not yet been brought against them, they could potentially face allegations of currency manipulation, illegal operations, and tax evasion. Although detained, they were not arrested and are currently engaged in discussions regarding national security with Nigeria.
