Home » Weakening naira: Nigeria slams $10bn fine on Binance

Weakening naira: Nigeria slams $10bn fine on Binance

by Samson Echenim

Nigeria has demanded a retribution of $10 billion from the world’s largest cryptocurrency centralized exchange, Binance for providing a peer to peer (P2P) platform for her citizens to buy and sell United States Dollar Tether (USDT), a stable cryptocurrency coin equivalent to the US dollar.

The Nigerian government began a clamp down against major cryptocurrency exchanges and forex brokers blaming them for the weakening naira value. The naira dipped
N2000/$ (USDT) on the Binance P2P platform mid-February before improving to N1600/$.

The Nigerian government said the cryprocurrency exchanges and the forex broker platforms provided platforms for Nigerians to speculate on the dollar against the naira and criminals to carry out money laundering, thereby making the naira to continue to lose its value.

Apart from Binance, other platforms such as Forextime, OctaFX, Crypto, FXTM, Coinbase, Kraken, among others, were equally blocked.

Binance CEO, Zhao

Binance founder and former CEO, Changpeng Zhao faces a fine of $4 billion in US

The Special Adviser to President Bola Tinubu on Information and Strategy, Bayo Onanuga, in an interview with the British Broadcasting Corporation (BBC) on Friday (today) said the Nigerian government has demanded that Binance makes to it a retribution of at least $10 billion, saying Binance profited substantially from its “illegal transactions” in Nigeria while the nation suffered huge losses.

The Office of the National Security Adviser (ONSA) had earlier confirmed that Binance was being investigated by the Nigerian authorities, following an arrest and detention of two top executives of the cryptocurrency company in Nigeria on Wednesday. According to a report by Financial Times, both executives flew into Nigeria last week following a ban on the Binance website and were arrested by officials of the office of the National Security Adviser and their passports seized.

The Binance officials had arrived Nigeria earlier in the week to negotiate with the government amid the crackdown. However, the meetings were deadlocked as they could not meet some of the demands put forward by the Nigerian government.

They were also accused of operating a business worth billions without the requisite registrations and documentation.

Presidential spokesman, Bayo Onanuga

The Nigerian authorities were said to have requested Binance executives to provide data relating to transactions involving the Nigerian Naira on the Binance platform in the last seven years. They also demanded that some other data relating to Nigeria be deleted from the Binance platform.

However, the Binance executives insisted that they should be taken to their respective countries’ embassies before they could comply.

The Nigerian government also obtained a court warrant to detain the officials for at least twelve days in the first instance, according to a source with knowledge of the matter.

National Security Adviser to Nigeria’s President, Nuhu Ribadu

While speaking with the BBC, Onanuga claimed that Binance was not registered in Nigeria and had no presence in the country. He alleged that people used the platform to arbitrarily fix dollar-naira rates; a practice he said negatively impacted the value of the local currency.

He explained further that the Binance team were already cooperating with the Nigerian government by providing useful information, and had already suspended naira related transactions on the platform.

“Nigeria nevertheless wants Binance to pay at least $10 billion in retribution,” Onanuga said.

Earlier in the week, Onanuga had alleged that if not stopped, the cryptocurrency trading platform would destroy the Nigerian economy by arbitrarily fixing foreign exchange rate.

“If we don’t clamp down on Binance, Binance will destroy the economy of this country. They just fix the rates,” he said on Channels Television’s Politics Today programme on Wednesday.

Binance CEO, Richard Teng

In its reaction last week, Binance said “users behaving in a manipulative way” will be removed from its platform.

“As industry leaders, we are working hand in hand with local authorities, lawmakers, and regulators to ensure we act on non-compliance,” the platform added, noting that it is “setting an upper limit for ads, filtering and removing bad ads, requiring and raising deposits for merchants posting ads as well as processes for actioning against any market manipulators.”

The Nigerian government’s retribution claim is coming months after Binance pleaded guilty and agreed to pay $4.3 billion to settle criminal money laundering charges levied by the U.S. Department of Justice.

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