CBN Governor Olayemi Cardoso has discussed the reasons behind restrictions on cryptocurrency exchanges like Binance to prevent illicit financial activities, citing $26 billion in unidentified transactions through Binance Nigeria. The CBN emphasizes the need for a strict regulatory framework in response to these concerns.
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Last week, the CBN instructed the Nigerian Communications Commission to suspend access to crypto websites, including Binance, Coinbase, and Kraken. This directive followed Binance’s decision to limit peer-to-peer transactions trading the USDT/NGN pair, coinciding with the Naira’s depreciation to record lows.
Bayo Onanuga, Special Adviser to President Bola Tinubu, raised concerns about Binance’s impact on the currency market and called for banning other crypto platforms like Kucoin and Bybit. Binance faced a $4.3 billion penalty for US criminal charges in November. CBN Governor Cardoso highlighted collaboration with regulatory agencies to address crypto market concerns, stressing the need to protect Nigerian interests and ensure regulatory compliance.
In June 2023, Binance faced regulatory scrutiny in Nigeria when the SEC labeled it an illegal entity, despite Binance’s denial of any connection to “Binance Nigeria Limited.”
Despite this, Binance has previously collaborated with the Nigerian government, with plans for a virtual free zone. Additionally, Governor Cardoso announced a 400 basis point increase in the Monetary Policy Rate (MPR) to 22.75% to tackle inflation, emphasizing the importance of stabilizing inflation to address regulatory hurdles.
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