Binance, a popular cryptocurrency exchange, is currently facing increased scrutiny in Nigeria, according to the governor of the country’s Central Bank. Olayemi Cardoso expressed concerns about suspicious financial activities occurring through Binance Nigeria. He stated that there is evidence of illicit flows of funds taking place through various entities, which is a cause for suspicion. In response to these concerns, different government agencies, including the Economic and Financial Crimes Commission, the police, and the office of the National Security Adviser, are collaborating to address the issue.
In addition, two Binance executives, who are citizens of the United States and the United Kingdom, have reportedly had their passports confiscated by the office of the National Security Adviser in Abuja, the capital of Nigeria. This action further highlights the increased scrutiny faced by the cryptocurrency exchange.
The situation escalated when internet access to Binance and other exchanges was blocked in Nigeria on February 21. This decision came after allegations made by presidential adviser Bayo Onanuga, who claimed that crypto exchanges were manipulating the country’s currency. As a response to regulatory concerns, Binance had already imposed restrictions on Tether (USDT) trading in Nigeria on February 20.
Recent reports suggest that other crypto exchanges, such as Forextime, OctaFX, Crypto, FXTM, Coinbase, and Kraken, were also blocked in Nigeria on February 27. These actions coincided with the Nigerian naira reaching an all-time low against the U.S. dollar on the same day.
It is worth noting that the Central Bank of Nigeria had previously lifted a two-year ban on banks engaging in crypto transactions in December. However, guidelines were issued to regulate virtual asset service providers. Additionally, Nigeria became the second country to launch a central bank digital currency in 2022, with the introduction of the naira-pegged cNGN stablecoin by the Africa Stablecoin Consortium in a CBN regulator sandbox.
Despite the ongoing developments in Nigeria, Binance has not yet provided a response to the situation when contacted by Cointelegraph for comment.
In other news related to cryptocurrencies in Africa, the use of Bitcoin in Senegal has been gaining traction. The reasons behind this adoption are explored in detail in a separate article.