- Nigeria sues Binance for $10 billion for manipulating the Naira exchange rate, causing it to devalue by 70%.
- Binance is cooperating with Nigeria, withdrawing Naira transactions and providing data, following allegations of money laundering.
The Nigerian state has made a financial claim against Binance, the world’s leading cryptocurrency exchange platform, seeking payment of $10 billion for alleged manipulations in the exchange rate of its national currency, the Naira.
Such manipulation would have caused a devaluation of close to 70% in its value in recent months. The accusations against Binance range from speculation in the foreign exchange market to involvement in illegal activities such as money laundering and the financing of terrorist acts. As part of the investigation, Nigerian authorities have detained two Binance executives for questioning.
From the Central Bank of Nigeria (CBN) it has been indicated that transactions worth approximately $26 billion have been channeled through Binance in the country, involving transactions whose participants cannot be fully identified.
In the face of the actions taken by the government, Binance has shown willingness to cooperate, suspending operations with Naira on its platform and sharing relevant information with the competent authorities.
This confrontation highlights the challenge of regulating the cryptocurrency market and the interaction between international exchange platforms and local regulations. Nigeria has established that to operate within its borders, these platforms must be duly registered, a condition that Binance and others like it have not yet met, despite the lifted ban on cryptocurrencies in 2023.
This incident not only reflects the tensions between the need for proper regulation in the cryptocurrency sector and the global operability of platforms such as Binance, but also highlights the importance of effective collaboration to ensure regulatory compliance and economic stability .
The outcome of this case could set a precedent for how governments handle and regulate cryptocurrency activities within their jurisdictions.
