Crypto Crackdown: Controversy Trails Detention Of Binance Executives In Nigeria

Eko Hot Blog reports that the Office of the National Security Adviser (NSA), Nuhu Ribadu, has reportedly detained two senior executives, an American and a British Pakistani, at Binance.

The detention comes amid the Nigerian government’s efforts to rein in speculation on the naira by cracking down on cryptocurrency exchanges.

Recall that last week, the federal government ordered telecoms companies to block access to some of the world’s largest cryptocurrency exchanges such as Binance, Coinbase and Kraken.

One of President Bola Tinubu’s spokespersons, Bayo Onanuga, accused Binance of “blatantly” setting the exchange rate for Nigeria and hijacking the central bank’s role as the currency rate setter.

According to Financial Times, the Binance executives were arrested on Wednesday after flying to Nigeria in the wake of the ban of cryptocurrency trading websites, but they were detained by Ribadu’s office and their passports seized.

The Nigerian government has blamed cryptocurrency websites for a rapid devaluation of the naira that helped drive inflation to an almost three-decade high of 29.9 per cent.

The sites have emerged as an alternative for trading and establishing an unofficial price for the Nigerian currency.

Following the detention of the executives, Binance halted trading of the naira against bitcoin and tether digital coins on its exchange.

On Tuesday Olayemi Cardoso, the Governor of the Central Bank of Nigeria (CBN), 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 entities [crypto platforms] and suspicious flows at best,” Cardoso told reporters.

“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 Financial Times also reported that the federal government was demanding to see a list of Binance’s Nigerian users since its inception.

Meanwhile, the detention of the crypto exchange executives has generated controversy online as some Nigerians criticised the government as trying to shift the blame of its failure on a foreign entity.