Forex crisis: FG slams $10 billion fine on Binance
The Federal Government has slammed a $10 billion fine on crypto trading platform, Binance, over allegations of influencing the country’s forex crisis.
The special adviser to President Bola Tinubu on information and strategy, Bayo Onanuga, disclosed this Friday morning in an interview with the BBC.
According to Onanuga, Binance profited substantially from its “illegal transactions” in Nigeria while the nation suffered huge losses.
Onanuga claimed that Binance is not registered in Nigeria and has no presence in the country. He alleged that people used the platform to arbitrarily fix dollar-naira rates; a practice he said negatively impacted the value of the local currency.
He explained further that the Binance team was already cooperating with the Nigerian government by providing useful information, and had already suspended naira-related transactions on the platform.
Binance accused of fixing rates
While noting that the government has been seeing the negative impacts of Binance’s operation in Nigeria, Onanuga said:
- “The platform fixes the exchange rate in Nigeria, which is illegal. The Central Bank of Nigeria is the only authority that can fix the exchange rate for Nigeria.
- “Binance harbours a lot of people who fix exchange rates which impacted the country badly at a time when the government is trying to stabilize the economy.”
He added that Binance influenced the increase in foreign exchange rates through currency speculations which made the Naira value fall by almost 70% in recent months.
Binance under investigation
Earlier on Friday, the Office of the National Security Adviser (ONSA) confirmed that the crypto exchange platform is being investigated by the Nigerian authorities. In its first official confirmation of the clampdown efforts on the activities of Binance and other crypto platforms, a top official of the ONSA told Premium Times that the security adviser’s office is coordinating an interagency investigation into the operations of Binance.
- “I am confirming that the office of the national security adviser, as part of ongoing operations in the foreign exchange market with the CBN and other law enforcement and security agencies, is coordinating an interagency investigation into the operations of Binance,” the paper quoted Zakari Mijinyawa, head of Strategic Communication at the Office of the National Security Adviser.
Nairametrics had earlier reported the arrest and detention of two top executives Binance on Wednesday over alleged manipulations in foreign exchange trading and speculative activities.
The executives visited Nigeria in response to the country’s recent crackdown on various cryptocurrency trading platforms.
- READ MORE: CBN Resumes Forex Sales to BDCs, Aims to Narrow Exchange Rate Gap
- Ibrahim Gaga Appointed Executive Director, Corporate Services at NEXIM Bank by President Tinubu
Onanuga’s call for the ban of Binance, others
Based on the accusation of influencing the Naira crisis, Mr Onanuga had earlier called for the ban of Binance, Kucoin, and other trading platforms in Nigeria.
The President’s Adviser urged the Economic and Financial Crimes Commission (EFCC) and the Central Bank of Nigeria (CBN) to take swift action to end the operations of the crypto exchanges in the country.
While accusing Nigerians trading currency on the Binance platform of unpatriotism, Onanuga said:
- “Binance which is blatantly setting exchange rates for Nigeria, hijacking CBN role, is a cryptocurrency trading platform and suffers access limitations from multiple jurisdictions, such as the US, Singapore, Canada and the UK.
- “According to Data Wallet, Binance is prohibited in the United Kingdom by the Financial Conduct Authority from conducting any regulated activities. In Japan, the Financial Services Agency (FSA) banned Binance for operating without the necessary regulatory approval.
- “Ontario, Canada, has also suspended Binance services following its inability to meet the province’s securities regulation criteria. The Monetary Authority of Singapore also banned Singaporean investors from accessing Binance’s services.”
He added that Binance, which is facing regulatory showdown in many countries, and causing disruptions in the currency market, should not be allowed to dictate the value of the Naira on its crypto exchange platform.
