In a recent twist, Nigeria has formally asked Binance, the world’s largest cryptocurrency exchange, to pay a hefty $10 billion penalty. This demand, as reported by BBC, arises from allegations that Binance played a pivotal role in the drastic devaluation of Nigeria’s fiat currency.
The Naira, Nigeria’s currency, has taken a substantial hit with a nearly 70% drop in value over the past few months, a situation squarely blamed on Binance by the Nigerian government.
Under President Ahmed Tinubu’s leadership, the Nigerian government asserts that Binance manipulated exchange rates, not only destabilizing the Naira but also facilitating illegal financial activities, including money laundering, theft, and fraud.
Responding robustly, the government has taken bold steps, detaining two top international executives from Binance for investigation on charges related to money laundering and terrorist funding.
Read More: Binance Will Destroy Nigeria’s Economy if Not Stopped: Presidency
The Central Bank of Nigeria (CBN) pointed out that around $26 billion passed through Binance’s Nigerian operations, involving transactions that the CBN couldn’t completely trace. This lack of transparency has raised doubts about the reliability of cryptocurrency transactions in the country, adding to existing skepticism towards the crypto industry.
Legal Hurdles for Binance
Binance’s legal standing in Nigeria adds another layer of complexity. According to Bayo Onanuga, spokesperson for President Bola Tinubu, Binance and similar entities failed to register, as required by Nigerian law. This issue became evident after Nigeria lifted its ban on cryptocurrencies, with the condition that all operators must be duly registered.
Also Read: Nigerian Authorities Announces Ban on Crypto Exchanges to Save Naira
In response to government pressure, Binance reportedly started cooperating, removing Naira transactions from its platform and engaging in talks to comply with Nigerian regulations. While seen as a positive step toward resolving the dispute, the outcome and duration of the ongoing investigation remain uncertain.
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