Binance forced out of services in Nigerian local currency amid crackdown on crypto exchanges

Binance will stop all transactions and trading in Nigeria’s local currency after March 8 amid a country-wide crackdown on crypto exchanges that have been blamed by authorities for feeding a black market for foreign exchange. It will stop supporting withdrawals after Friday and any remaining balances in Nigerian Naira will be automatically converted into Tether – a stablecoin whose value is pegged to the U.S. dollar. Last week, Nigerian authorities detained two Binance senior executives on undisclosed charges as part of the crackdown. They were still in custody, their local lawyer said before a parliamentary committee on Monday. 

The Federal Government had detained at least two senior executives of Binance, a crypto currency exchange company. According to a report by Financial Times, both executives flew into Nigeria last week following a ban on their website and were arrested by officials of the office of the National Security Adviser and their passports seized. Binance is an online exchange where users can trade cryptocurrencies. Nigeria is one of the largest peer-to-peer crypto markets in the world. Between July 2022 and June 2023, crypto transactions in the country reached $56.7bn, according to Chainalysis.

The arrest came amidst efforts by the government to rein in speculation on the naira by cracking down on cryptocurrency exchanges. Recently, the government through the Nigerian Communications Commission blocked the online platforms of Binance and other crypto firms to avert what it considers continuous manipulation of the forex market and illicit movement of funds. It also sent operatives of the Economic and Financial Crimes Commission to arrest Bureau De Change operators at the Popular Wuse Zone 4 in Abuja.