Nigerian authorities have reasons to feel they are right in cracking down on the cryptocurrency business. The most recent incident involved detaining two Binance executives and taking their passports. It occurred when both executives flew to Nigeria following the country’s decision to ban several cryptocurrency trading websites. This dates back to the previous week, when detention occurred under the country’s national security advisor.
Binance, or Binance Nigeria, is expected to issue an official statement shortly. Concerning the executives affiliated with cryptocurrency exchange platforms, the Nigerian authorities remain resolute in pursuing criminal action. This follows the second devaluation of the Naira in less than a year.
The Nigerian currency is going through a tough time with an immense shortage against the US Dollar. Crypto exchange platforms were found to be a preferable place for users to trade the currency. Amid its attempts to attract investment, there is no denying the fact that Nigeria is simultaneously trying to protect its currency from losing value any further.
Naira was last seen being traded at $0.000633. It is down from $0.0011 as of January 31, 2024.
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Two reasons have been identified for foreign investors flying away from the country. These were the collapse of oil prices and the introduction of capital controls almost 9 years ago, that is, in 2015. Both factors collectively contributed to the Dollar shortage, pushing the native currency to a new low in recent times.
Olayemi Cardoso, the Governor of Nigeria’s Central Bank, talked about the issue and mentioned Binance in their statement. Cardoso said that certain activities make up for illicit flows via crypto platforms. They added that Binance alone passed approximately $26 billion through its platform with sources and users they are unable to identify. Authorities have demanded a list of users from Binance, with no update available on the matter as of now.
Their statements have put all the platforms on their toes. Several top crypto exchanges in Nigeria, like Coinbase and Kraken, have started seeing the effects. Telecom regulators sought telecom companies to block access to such platforms last week.
These are in line with Bola Tinubu’s efforts to attract foreign investments. The President of Nigeria is undertaking steps to bring the struggling economy out of the ashes through market-friendly norms. These are likely to hint at having an economy that is safe and transparent for investors who hail worldwide. Nigeria is going through a messy system of multiple exchange rates and has seen currency devaluation happen twice in just eight months.
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The crypto market remains unaffected by developments happening in Nigeria. BTC has surpassed the milestone of $60k, and ETH is above $3,400 at the time of writing this article. Both tokens are safely testing the resistance of the said milestones. BTC is listed at $62,945.54 and ETH is exchanging hands at $3,470.38.
