The governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, has accused major cryptocurrency exchange Binance of enabling suspicious flows of funds that are destabilizing the Nigerian economy.
In comments on February 27th, Cardoso claimed over $26 billion has passed through Binance’s operations in Nigeria over the past year from unidentified sources. He stated that Nigeria’s securities regulator and other government agencies have Binance and other crypto platforms under investigation for potential illicit activity.
Also, there are reports that Nigeria’s Office of the National Security Adviser has detained two Binance executives and confiscated their passports. The executives are citizens of the US and UK.
On February 21st, internet access to Binance and other crypto exchanges was blocked in Nigeria after presidential adviser Bayo Onanuga alleged the platforms were manipulating the naira currency’s exchange rate. Binance had placed restrictions on trading of the stablecoin Tether in Nigeria to appease regulators.
The naira hit record lows against the US dollar on February 27th, just 2 months after CBN lifted the two-year ban on banks’ crypto transactions in December 2022. However, Binance and other major crypto platforms now face intensified scrutiny from the CBN, anti-corruption agencies, and national security staff who are coordinating efforts to investigate suspicious crypto flows.
Presidential spokesman Onanuga has urged Nigerians to stop using the parallel FX market and says if left unchecked, Binance “will destroy the economy” by arbitrarily fixing exchange rates. The CBN is Nigeria’s sole legal platform for exchange rates, Onanuga stated.
Cardoso said the investigations involve the Economic and Financial Crimes Commission, the police, and the National Security Adviser’s office. Crypto flows are being labeled illicit and sabotaged. The CBN chief said once exchange rates stabilize, prices of goods in Nigeria will normalize.
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