Binance, a popular cryptocurrency exchange platform with over 170 million users globally, has disabled its peer-to-peer feature for Nigerian users.
Gatekeepers News reports that this feature, known as the P2P market, allows buyers and sellers to trade cryptocurrencies without any third-party intervention.
The Nigerian Government outlawed the country’s cryptocurrency industry in 2021, and since then, the P2P market gained popularity among Nigerians as an alternative way to engage in trade and set an informal value for the naira.
The Nigerian Government expressed concerns about the $26 billion that came through Binance Nigeria from unidentified sources in the previous year.
The Central Bank of Nigeria (CBN) suggested that the Office of the National Security Adviser (NSA), the Securities and Exchange Commission (SEC), the Police, and the Economic and Financial Crimes Commission (EFCC) work together to combat illegal financial activities.
To stop what it views as ongoing manipulation of the foreign exchange market and unlawful money transfers, the Federal Government recently disabled the websites of Binance and other cryptocurrency companies.
Two senior Binance officials have been detained in Nigeria as the nation looks to crack down on cryptocurrency exchanges to tame the speculation of the naira.
Nigeria has one of the youngest demographics in the world, with 43% of its current population under the age of 15, and one of the fastest-growing populations in Africa, with a current population of 223 million. A younger, tech-savvy population combined with declining smartphone costs is opening new avenues for cryptocurrency-related activities.
According to a report from Chainalysis, Nigeria continues to have the highest cryptocurrency usage in Africa and is among the most developed globally, with a 9% annual growth rate. This places Nigeria in third place out of only six countries that have seen consistent growth since 2021.
However, according to Nigeria’s top State officials, cryptocurrency companies enable money launderers and currency speculators to carry out illegal operations.
Authorities think that a major factor in the naira’s decline is the “criminal activities” taking place on the platforms.
The Government got a court warrant to hold the Binance officials for a minimum of twelve days and demanded that they submit information on any transactions made on the Binance platform using Nigerian Naira during the last seven years. They further demanded that some other Nigerian-related data be removed from the Binance site.
Recently, the Nigerian Communications Commission (NCC) directed telecom companies to restrict access to some of the biggest bitcoin exchanges globally, including Binance, Coinbase, and Kraken.
At a press conference, President Bola Tinubu’s Spokesperson, Bayo Onanuga claimed that Binance was “blatantly” determining the exchange rate and taking over the CBN’s position as the entity that sets currency rates.
