Reports have emerged indicating that the Federal Government of Nigeria has detained two senior executives of Binance, a cryptocurrency exchange company.
According to a report by the Financial Times, the executives were arrested after flying into Nigeria last week, following a ban on their website. Officials from the office of the National Security Adviser reportedly apprehended them and seized their passports upon arrival.
Binance, an online platform for trading cryptocurrencies, has been a prominent player in Nigeria’s crypto market, one of the largest peer-to-peer markets globally. Between July 2022 and June 2023, crypto transactions in the country amounted to $56.7 billion, according to Chainalysis.
The arrest of the Binance executives comes amid the government’s efforts to curb speculation on the naira by cracking down on cryptocurrency exchanges. Recently, the Nigerian Communications Commission blocked the online platforms of Binance and other crypto firms to prevent what it perceives as manipulation of the forex market and illicit fund movements.
Governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, highlighted concerns about illicit flows and suspicious activities on crypto platforms, specifically mentioning Binance. He stated that $26 billion had passed through Binance Nigeria in the past year from sources and users that could not be adequately identified.
In June 2023, the Securities and Exchange Commission declared the operation of Binance Nigeria Limited illegal. Furthermore, there have been calls for a ban on Binance and other crypto platforms by government officials, citing concerns about their impact on the Nigerian economy.
Efforts to confirm the situation from the Office of the National Security Adviser were unsuccessful, as Zakari Mijinyawa did not respond to messages. However, Presidential spokesman Bayo Onanuga affirmed that the government has taken action against Binance, accusing the platform of arbitrarily fixing foreign exchange rates, which could undermine Nigeria’s economy.
Onanuga emphasized the need to stop patronizing the parallel market for foreign exchange rates, urging Nigerians to rely on the official rates provided by the CBN. He expressed optimism that stabilizing the exchange rate would lead to improvements in the country’s economic conditions in the coming weeks.
