Two representatives from Binance, the world's largest cryptocurrency exchange, including an American citizen, have been detained in Nigeria. This development follows their journey to the country for discussions with government officials. As the Nigerian government grapples with an economic crisis, Binance has suspended its services related to the Nigerian naira (NGN).
Binance announced on its website that it would be discontinuing its NGN services. The suspension begins with the removal of NGN deposits on March 5. Following this, Binance will delist all NGN spot trading pairs on March 7. By March 8, users will not be able to make withdrawals in NGN. Any remaining NGN balances will be converted to USDT.
According to Decrypt, the Nigerian government initiated a crackdown on crypto companies following the devaluation of the naira. Amidst this crackdown, two Binance executives travelled to Nigeria to discuss the situation with government officials. These executives - one American and one British citizen - are now being detained in Abuja, Nigeria's capital city. The crypto crackdown is a response to the volatility of the NGN which saw inflation rates peak at 29.9% in January. Many Nigerians have turned to cryptocurrencies as a means of protecting their money from inflation and economic instability.
Leadership reported Professor Kingsley Moghalu, a former deputy governor of the Central Bank of Nigeria (CBN), as saying that commercial bank executives should have been held accountable for the devaluation of the naira instead of scapegoating crypto companies. According to Moghalu, Nigeria’s current economic turmoil is due to years of mismanagement and government corruption resulting in hyperinflation, decreased purchasing power and currency devaluation.
The Premium Times reported that Nigerian lawmakers are expressing concerns about President Bola Ahmed Tinubu’s approach towards the crypto industry. In response to these concerns, Nigeria’s House of Representatives has resolved to launch an investigation into the situation. Lawmaker Ibrahim Isiaka expressed that the government’s detention of the two Binance executives puts Nigeria in a negative light regarding global statutes on fundamental human rights and rule of law. Isiaka also disputed the claim that crypto companies are negatively impacting the foreign exchange market, stating it lacks factual support.
According to CoinMarketCap, Binance was launched in 2017. As of August 2022, Binance had a daily trading volume of approximately $76B, making it the largest crypto exchange globally. The platform lists more than 350 tokens and enables users to buy, sell, and store digital assets.
