Recently, a Federal High Court in Nigeria made a significant ruling that could potentially have far-reaching consequences for Binance, the world’s largest cryptocurrency exchange. The court ordered Binance to release comprehensive data of all local users trading on its platform to the Economic and Financial Crimes Commission (EFCC). This move comes as part of a clampdown on the firm due to its alleged role in the devaluation of the naira, Nigeria’s national currency.
Judge Emeka Nwite of the Abuja Division of the Federal High Court granted the order after an ex parte motion was moved by the EFCC’s lawyer, Ekele Iheanacho. This development follows a previous demand by the Nigerian government for information on Binance’s top 100 local users and transaction records for the past six months. The authorities in Nigeria believe that the trading platform is undermining their efforts to strengthen the national currency.
Aside from being accused of contributing to the devaluation of the naira, Binance is also facing scrutiny for allegations of money laundering and terrorism financing. The court order requires Binance to provide comprehensive data/information relating to all Nigerian users on its platform. This information will enable the EFCC to conduct a thorough investigation into Binance’s operations in the country.
Hamma Bello, an EFCC operative, filed an affidavit in support of the motion against Binance. He informed the court that the agency had received reports of price discovery, confirmation, and market manipulation on the platform, leading to the devaluation of the naira. Bello stated that Binance was previously asked to delist the naira and provide the Office of the National Security Adviser (ONSA) with information on Nigerian activities on the platform.
As a result of these developments, two foreign Binance executives are currently detained in Nigeria to assist with investigations. The data obtained from Binance, which revealed a trading volume of $21.6 million from Nigeria in 2023, is expected to shed more light on the platform’s operations and its impact on the local economy.
The legal actions taken against Binance in Nigeria highlight the growing concerns surrounding cryptocurrency exchanges and their potential effects on national economies. The outcome of this case will not only have implications for Binance but could also set a precedent for how governments regulate and oversee cryptocurrency trading in the future.
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