Legal Troubles Lead To Binance Halting All Nigerian Currency Services

Earlier this week, Binance declared its decision to halt all services involving the Nigerian naira, citing an ongoing legal conflict between the U.S.-based cryptocurrency company and Nigeria, the most populous nation in Africa.

Binance announced that any remaining balances in user accounts denominated in naira will be automatically converted to Tether, a stablecoin cryptocurrency tied to the value of the U.S. dollar. The company specified that it will cease supporting deposits in naira after 02:00 P.M. UTC on March 5th and will discontinue withdrawals of the currency after 06:00 A.M. UTC on March 8th.

Binance Still Controversial

Binance has previously faced controversy due to various reasons. The exchange has encountered regulatory scrutiny in several countries over compliance issues related to operating without proper licenses or regulatory oversight. The platform has also experienced security breaches in the past, leading to the loss of user funds and raising questions about its security measures. Some critics have also accused Binance of lacking transparency in its operations, including its listing processes and trading activities.

Moreover, Binance has been involved in legal disputes with authorities in different countries over allegations ranging including money laundering and regulatory violations. Lastly, there have also been allegations of market manipulation against Binance, including accusations of wash trading and insider trading. These controversies have contributed to Binance facing numerous challenges in maintaining its reputation and regulatory compliance.

The Importance Of Nigeria

Nigeria is recognized as one of the largest cryptocurrency markets globally. However, reports indicate that the Nigerian government is seeking nearly $10 billion in damages by Binance. The government alleges that Binance engaged in manipulation of foreign exchange rates through currency speculation and rate fixing. Last week, Nigerian authorities reportedly arrested two senior executives of the firm.

The Nigerian naira has experienced a significant devaluation, with its value dropping by approximately 70% in recent months. This depreciation coincides with a currency crisis and steep inflation in the largest economy within Africa.