Nigeria sues Binance for $10 billion in damages
The Nigerian government has demanded $10 billion from Binance, claiming the cryptocurrency exchange’s activities have had a negative impact on the naira and the country’s economy.
According to the BBC, the Nigerian government is demanding a whopping $10 billion in damages from Binance, the world’s largest cryptocurrency exchange platform, over accusations that its activities have significantly destabilized the country’s economy.
The claims center around claims that Binance played a major role in manipulating exchange rates and contributed to the nearly 70% decline in the value of the naira in recent months. President Bola Tinubu’s spokesperson, Bayo Onanuga, emphasized that Binance’s operations have a detrimental impact on Nigeria’s attempts to stabilize its economy.
According to Onanuga, “The platform is fixing the country’s exchange rate at an illegal rate. The Central Bank of Nigeria (CBN) is the only institution that can set the exchange rate in the country.”
Security agencies also detained two foreign executives of Binance as part of an ongoing investigation into allegations that the platform was involved in money laundering and terrorist financing.
Nigeria’s Central Bank Governor Olayemi Cardoso said about $26 billion in cryptocurrency transactions were transacted through Binance Nigeria, many of them from “sources and users that we cannot adequately identify.” and emphasized the regulatory problems caused by cryptocurrency.
Nigerian authorities claim Binance and other cryptocurrency companies have been operating without proper registration, contrary to the country’s laws. Even after the CBN lifts the cryptocurrency ban in 2023, compliance with the registration requirements of the Security and Exchange Commission (SEC) remains a controversial issue.
Binance subsequently removed naira trading from its platform as part of its cooperation with the government. Onanuga noted that the government’s demands are not excessive, considering the rapid and severe economic disruption caused by Binance’s activities.
As the investigation continues, further details about the length of the investigation and the nature of discussions between the Nigerian government and Binance have not been disclosed. The situation has sparked widespread discussion about cryptocurrency exchange regulation and the impact of decentralized finance platforms on the national economy.
This incident has far-reaching implications for the cryptocurrency industry, especially in terms of regulatory compliance and the relationship between digital currency platforms and national monetary policies. It also raises important questions about the balance between innovation in the financial sector and the need for governments to protect the economy.
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