FG Detains Two Binance Executives – Report

The Federal Government has allegedly 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.

At a press briefing on Tuesday, the Governor of the CBN, Olayemi Cardoso, named Binance at a press conference while discussing the funds flowing through crypto exchanges.

“We are concerned that certain practices go on that indicate illicit flows going through a number of these crypto platforms and suspicious flows at best,”

“In the case of Binance, in the last one year alone, $26bn has passed through Binance Nigeria from sources and users who we cannot adequately identify,” he added.

According to Cardoso, Nigeria’s anti-corruption agency, police and national security adviser were co-ordinating an investigation into cryptocurrency exchanges.

The authorities were demanding to see a list of Binance’s Nigerian users since its inception, a person familiar with the matter said.

In June 2023, the Securities and Exchange Commission said the operation of Binance Nigeria Limited, a subsidiary of Binance, was illegal.

Some days ago, the Special Adviser to President Bola Tinubu on Information and Strategy, Bayo Onanuga, shared some reports on X (formerly Twitter), supporting an act that could be seen as a confirmation of the development.

He had called for a ban on Binance and other crypto platforms operating in Nigeria to curb foreign exchange rate distortions.

Efforts to reach the Head of Strategic Communication, Office of the National Security Adviser, Zakari Mijinyawa, for confirmation proved as he didn’t respond to WhatsApp and texts messages sent to his line.

Meanwhile, a presidential spokesman, Bayo Onanuga, has stated that cryptocurrency trading website Binance may destroy the Nigerian economy by arbitrarily fixing foreign exchange rate if not stopped.

While confirming that the government has taken strict action against the website, Onanuga stressed that the saboteurs used the cyberspace to dictate even our exchange rate, hijacking the role of the CBN.

Onanuga speaking on Channels Television’s Politics Today programme on Wednesday said, “If we don’t clamp down on Binance, Binance will destroy the economy of this country. They just fix the rate.”

“We have saboteurs. Look at what Binance is doing to our economy. That is why the government moved against Binance. Some people sit down using the cyberspace to dictate even our exchange rate, hijacking the role of the CBN.

“They just sit down and fix anything they like. It’s sabotage and we are trying to prevent that from happening henceforth.”

The presidential aide further urged Nigerians to stop patronising the parallel market for FX rates, saying the website of the apex bank was the only legal platform.

“The parallel market is not the real gauge of Nigeria’s economic health. The parallel market is an illegal market.

“I don’t even know why Nigerians and the media are feeding on the parallel market. That is not where we should go; what’s the CBN rate? As at Friday, the rate for the dollar was about N1600.

“Even in the so-called parallel market, the exchange rate is stabilizing there and that is what this needs. Our economy is too much dollarised. Importers are looking at the exchange rate and using it to fix prices, some of them arbitrarily, some of them actually profiteering,” Onanuga stated.

According to him, once the CBN succeeds in stabilising the exchange rate, the prices of goods in the country will normalise. “Things are not going to get worse, they are going to get better in the next few weeks,” he noted.