Binance Faces Record $10B Penalty in Nigerian Government Crackdown

The Nigerian government has imposed a substantial $10 billion fine on Binance, the global crypto exchange giant. This decision, revealed by Bayo Onanuga, special adviser on information and strategy to President Bola Tinubu, comes amidst an ongoing investigation by the Office of the National Security Adviser (ONSA) into the operations of Binance and other crypto platforms.

As Onanuga stated, the fine is a response to Binance's alleged illegal operations, which the government believes have played a significant role in the recent devaluation of the Nigerian Naira. Binance is accused of profiting substantially from these "illegal transactions" while the nation incurred substantial losses.

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Detention of Binance Executives

Earlier on Feb. 29, two Binance executives were detained in Abuja shortly after flying into Nigeria to negotiate with authorities amid the government's crypto platform crackdown. 

The Nigerian authorities requested seven years of transaction data related to the Nigerian Naira on the Binance platform and the deletion of certain Nigerian data.

However, Binance executives insisted on being taken to their respective countries’ embassies before complying with the authorities' requests. 

Onanuga alleges that Binance, unregistered in Nigeria and lacking a physical presence, facilitated dollar-naira arbitrage trading on its platform, negatively impacting the local currency's value.

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Regulatory History and Previous Troubles

In September 2023, Nigeria’s Securities and Exchange Commission (SEC) declared Binance Nigeria Limited illegal, citing a lack of registration and regulation. 

During a recent monetary policy meeting, Nigeria's central bank governor, Yemi Cardoso, revealed that Binance Nigeria facilitated transactions exceeding $26 billion from unidentified sources in one year.

However, according to Onanuga, Binance is cooperating with the Nigerian government by providing information. The exchange has already halted naira-related transactions.