Nigerian Government Demands $10 billion in Damages from Binance, Alleging Forex Manipulation

In a bold move aimed at addressing Nigeria’s ongoing forex crisis, the Federal Government has levied a staggering $10 billion fine on Binance, one of the world’s largest cryptocurrency trading platforms. The announcement came through Bayo Onanuga, the special adviser to President Bola Tinubu on information and strategy, in an exclusive interview with the BBC on Friday morning.

Onanuga’s revelation shed light on the government’s concerns regarding Binance’s alleged role in exacerbating Nigeria’s forex woes. He asserted that the platform profited significantly from what he termed “illegal transactions” within Nigeria, while the nation endured substantial losses. Furthermore, he claimed that Binance, despite lacking registration or physical presence in Nigeria, facilitated illicit activities, including the arbitrary fixing of dollar-naira exchange rates. This practice, according to Onanuga, had detrimental effects on the value of the local currency.

Addressing the gravity of the situation, Onanuga emphasized that Binance’s actions contravened Nigerian laws, particularly regarding the determination of exchange rates. He underscored the exclusive authority of the Central Bank of Nigeria (CBN) in this regard, condemning Binance’s purported manipulation of exchange rates as unlawful and damaging to the economy. According to Onanuga, the platform’s activities contributed to a significant increase in foreign exchange rates, resulting in a nearly 70% depreciation of the Naira in recent months.

The revelation of the government’s crackdown on Binance comes amidst an ongoing investigation spearheaded by the Office of the National Security Adviser (ONSA). Zakari Mijinyawa, head of Strategic Communication at the ONSA, confirmed the interagency probe into Binance’s operations, highlighting collaboration with the CBN and other law enforcement agencies. This coordinated effort reflects the government’s determination to address concerns surrounding cryptocurrency trading platforms, particularly regarding potential threats to national security and economic stability.

Earlier reports of the arrest and detention of two senior Binance executives underscore the government’s commitment to holding accountable those allegedly involved in illicit financial activities. The executives’ visit to Nigeria in response to heightened scrutiny of cryptocurrency platforms further underscores the significance of the government’s crackdown on Binance and its counterparts.

Echoing Onanuga’s sentiments, the call for the ban of Binance and other trading platforms in Nigeria gains momentum. The President’s adviser urged swift action from the Economic and Financial Crimes Commission (EFCC) and the CBN to curtail the operations of these platforms, citing their adverse impact on the nation’s financial landscape. He pointed to regulatory actions taken against Binance in various jurisdictions worldwide, emphasizing the need for Nigeria to safeguard its currency and financial sovereignty.

As Nigeria navigates its economic challenges, the imposition of a hefty fine on Binance marks a pivotal moment in the government’s efforts to address forex instability and safeguard national interests. The outcome of the ongoing investigation and the government’s subsequent actions will undoubtedly shape the future of cryptocurrency regulation in Nigeria and influence broader discussions on financial governance and accountability.