The news:
- The Nigerian government is reportedly in the process of shutting down crypto websites in the country.
- A source close to the matter told Techpoint Africa that telcos could be instructed not to allow people to visit the sites
- This is coming after crypto platform, Binance shutdown peer-to-peer P2P trading on its platform.
The CBN could be looking to block Nigerians from using crypto websites to combat the weakening of the naira.
While this is unconfirmed a source close to the matter said the apex bank could use telcos to block access to those websites and apps in Nigeria.
This is coming after crypto platform, Binance suspended P2P activities yesterday, February 20, 2024. Users of the platform took to X to complain about the unavailability of USDT buy ads on the platform.
In response, Binance released a statement saying it is "dedicated to providing a market-driven, fraud-free, and manipulation-free platform for users," not giving a reason for Suspending crypto activities on the platform.
It, however, said it was working hand in hand with local authorities, lawmakers, and regulators to be compliant.
Interestingly, an X user, with username Brother Bernard, said the CBN, National Security Agency (NSA), and the Economic and Financial Crimes Commission (EFCC) are working with Binance to set a cap for USDT traders.
In another statement released today, February 21, 2024, Binance explained why it suspended P2P trading on the platform. It said its system automatically pauses when there's significant currency movement.
According to the company, this feature was put in place to prevent abuse of the system. It also revealed that there was a temporary suppression yesterday that reached its system limit and necessary adjustments needed to be made.
The exchange has, however, resumed P2P trade on its platform in the evening of Wednesday, February 21, 2024.
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However, many consider this move by Binance as a collaboration with the CBN to control their trading, reducing their trust in the platform.
There have been many posts on X listing alternatives to Binance saying the platform cannot be trusted.
Last year the Nigerian Securities and Exchange Commission (SEC), declared the crypto company, Binance Nigeria Limited illegal in the country, warning users about the risks of using the platform. Binance, however, said it is not affiliated with the entity, Binance Nigeria Limited.
However, the SEC confirmed that the entity it referred to is the popular crypto exchange Binance. It is still unclear if this move by Binance is related to the SEC's declaration last year.
A news report by Premium Times, also said that Nigeria plans to clampdown Binance and other crypto platforms in the country.
A source from the EFCC who spoke to the publication said the platform is giving the dollar a fake value against the naira, describing the process as a “sophisticated heist against the Nigerian economy.”
A senior executive at the CBN also told the outlet that Binance is being used as a "benchmark for currency trading, misleadingly devaluing the Naira in global markets."
Binance's statement today however denied this. It said "Binance provides a P2P marketplace, not as a price discovery platform. To be clear: it is market-driven and is not intended to be a proxy for currency pricing in Nigeria."
Techpoint Africa reached out to Binance and it has agreed to comment on the issue.
This is a developing story.
[Update] Wednesday, February 21, 2024: This article was updated to show that P2P trading has resumed on Binance.
