Nigeria is reportedly pursuing Binance for information regarding its top 100 users within the country amid heightened scrutiny of the exchange. The government has also indicated a potential imposition of a substantial fine, estimated at $10 billion, in response to what it perceives as adverse effects on the local economy.
According to a report by the Financial Times dated March 13, Nigerian authorities have formally requested Binance to furnish data concerning its leading users and their transactional history spanning the preceding six months. Additionally, the office of Nigeria’s national security adviser has urged Binance to address any outstanding tax obligations.
These developments come against the backdrop of ongoing negotiations between Binance and Nigerian officials, with the latter asserting the exchange’s purported influence on the domestic currency, the Nigerian naira. Bayo Onanuga, the presidential adviser on information and strategy, contended that Binance and other cryptocurrency platforms played a role in manipulating the naira, thereby precipitating a significant devaluation of the local fiat currency. Onanuga has also advocated for the prohibition of platforms like Binance within the country.
In response to Binance’s attempts to engage in dialogue with Nigerian authorities, two senior executives of the exchange, namely Tigran Gambaryan and Nadeem Anjarwalla, were reportedly detained by local prosecutors. Despite Binance’s subsequent delisting of all naira transactions and cessation of peer-to-peer naira transactions in late February, Gambaryan and Anjarwalla remain in custody.
Onanuga indicated that the detained executives have been cooperative with Nigerian authorities, providing substantial information. He further suggested the possibility of Nigeria imposing a $10 billion fine on Binance as retribution for what he described as the exchange’s detrimental impact on the Nigerian economy.
The office of the national security adviser emphasized the necessity of allowing law enforcement agencies the requisite time and space to conduct their investigations, pledging to disclose outcomes in due course.
In response to queries regarding the allegations leveled against the exchange by Nigerian authorities, Binance declined to comment on the substance of the claims. A spokesperson for Binance reiterated that the exchange had not ceased operations in Nigeria but had instead discontinued all naira-related trading pairs and transactions.
However, some online commentators have questioned Binance’s continued ability to cater to users in Nigeria under prevailing circumstances. One commenter highlighted that the cessation of naira-related services could be interpreted as the company disengaging from Nigerian operations entirely.
Nigeria has emerged as one of the world’s fastest-growing cryptocurrency markets in recent years, ranking second globally in terms of crypto adoption in 2023. The country was previously identified as the most crypto-obsessed nation by the volume of Google searches for terms such as “cryptocurrency” or “buy crypto.”
The Financial Times reported that Nigeria abandoned its longstanding currency peg in June 2023, allowing the naira to float freely, resulting in record-high inflation. As of January 2024, consumer inflation in Nigeria had risen for the 13th consecutive month, reaching nearly 30%, according to data from the National Bureau of Statistics.
