Binance, a leading global cryptocurrency exchange, has announced its exit from the Nigerian market, signaling an end to all transactions involving the Nigerian naira (NGN) by March 8, following difficulties with local financial regulators. The decision to halt operations comes as part of a broader response to regulatory scrutiny within Nigeria.
Final Days for NGN Transactions on Binance
The platform revealed plans to stop NGN withdrawals after March 8. Subsequently, any NGN holdings in Binance accounts will be automatically converted to the Tether (USDT) stablecoin. Binance has urged its users to either withdraw their NGN, exchange NGN assets, or convert their NGN to cryptocurrency before the service discontinuation. The conversion rate for this process will reflect the average closing price of the USDT/NGN trading pair on Binance’s Spot market over the previous seven days.
In preparation for this transition, Binance will also cease NGN deposits after 2:00 pm UTC on March 5 and will remove all trading pairs involving NGN from the platform by March 7. Moreover, Binance Pay will exclude NGN from its list of accepted currencies starting March 6, with the exchange’s peer-to-peer platform having already delisted all NGN trading pairs at the end of February.
Regulatory Pressures in Nigeria
The move to discontinue NGN services comes amid heightened regulatory scrutiny in Nigeria. Recent criticisms from the Central Bank of Nigeria’s governor concerning the alleged handling of illicit transactions by crypto exchanges, specifically Binance, have raised concerns. Additionally, actions taken against Binance executives by Nigeria’s National Security Adviser, including the confiscation of passports of two executives from the United States and the United Kingdom, underscore the increasing suspicions of Binance’s operations within the country.
The Nigerian House of Representatives Committee on Financial Crimes has further escalated the situation by summoning Binance CEO Richard Teng to address these issues directly, setting a firm deadline for compliance.
Nigeria’s Crypto Landscape
Despite these regulatory challenges, Nigeria has emerged as a significant player in the global cryptocurrency market. Chainalysis ranked Nigeria second globally in cryptocurrency adoption in September 2023, and in August 2022, the country was recognized as the most interested in cryptocurrency based on Google search data. However, the enthusiasm shown by the Nigerian populace towards cryptocurrency contrasts with the regulatory environment, highlighted by a proposed ban on Binance and other crypto trading platforms by an adviser to Nigeria’s president in February 2024, following a ban on financial institutions from servicing crypto exchanges enacted two years prior.
This development marks a significant shift for Binance and reflects the ongoing tensions between cryptocurrency platforms and regulatory bodies in emerging markets.
