ProbabaFX had reported that the government was considering blocking Binance and other crypto firms.
The Nigerian government has restricted Binance and other cryptocurrency businesses’ web platforms to prevent what it calls ongoing FX market manipulation and illegal financial movement. According to sources within the country’s main telecommunications businesses, the Nigerian Communications Commission (NCC) issued the decision to telcos, and they have begun implementing it. Apart from Binance, other services, including Forextime, OctaFX, Crypto, FXTM, Coinbase, and Kraken, were also blacklisted. According to ProbabaFX, the government is considering suspending Binance and other crypto businesses’ internet portals to prevent the local currency from falling further.
According to presidential and regulatory officials, the government decided to take action against Binance and other cryptocurrency businesses in response to accusations that currency speculators and money launderers were using them to carry out illicit operations. Authorities feel that the ‘criminal operations’ taking place on platforms are largely contributing to the naira’s weakness. Binance, a digital asset platform, acts as a portal for peer-to-peer transactions, allowing users to display their desire to sell or acquire currencies of their choosing. In September 2023, Nigeria’s Securities and Exchange Commission (SEC) issued a disclaimer to Binance Nigeria Limited, stating that the platform was “neither registered nor regulated by the Commission, and its operations in Nigeria are thus illegal.”
Despite the regulatory agency’s warning, the company continued to operate, drawing a considerable number of consumers, including urban teenagers, suspected speculators, and money launderers. Aside from accusations of economic sabotage, officials raise national security concerns, citing the platforms’ frequent use by other criminal organizations, particularly for ransom payments.
Binance responded earlier on Wednesday, stating that “users behaving in a manipulative way” will be banned from the platform.
“As industry leaders, we are working hand in hand with local authorities, lawmakers, and regulators to ensure we act on non-compliance,” the website stated. It added that it was “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 stated on Tuesday that it intended to raise $10 billion to increase liquidity in the foreign currency markets. President Bola Tinubu, represented by Vice President Kashim Shettima, announced this on Tuesday at the first Public Wealth Management Conference in Abuja.
“At the foundation of this is guaranteeing effective management of the Federal Government’s assets and investments to maximize their revenue potential. This includes our bold and feasible strategy to double GDP growth and greatly expand the GDP base over the next eight years,” Mr. Shettima stated. Meanwhile, the naira fell to an all-time low of N1,900 per dollar on Tuesday on the parallel market, fueled by speculation and uncertainty over market supply shortages. However, the Nigerian Autonomous Foreign Exchange Market (NAFEM) saw the local currency rise marginally to N1,551.24.
Earlier on Tuesday, the National Security Adviser’s office instructed law enforcement authorities to take harsh action against anybody engaging in foreign exchange market speculation.
READ ALSO: Forex Crisis: Nigeria plans clampdown on Binance, other crypto firms
“In a concerted effort to safeguard Nigeria’s foreign exchange market and combat speculative activities, the Office of the National Security Adviser and the Central Bank of Nigeria are joining forces to address challenges impacting the nation’s economic stability,” according to a statement released by the office.
“The CBN’s aggressive steps to calm the foreign currency market and boost economic activity have been noteworthy. However, the efficiency of these attempts is being hampered by the activity of speculators, both domestic and foreign, who operate via numerous channels, worsening the Nigerian naira’s devaluation.”
Source: @premuimtimesng
