The Presidency has said cryptocurrency trading website Binance will destroy the Nigerian economy if not stopped. According to Onanuga, the platform could destroy the nation’s economy by arbitrarily fixing the foreign exchange rate.
Special Adviser to President Tinubu on Information and Strategy Bayo Onanuga stated this in an interview on Channels Television’s Politics Today on Wednesday
He said, “If we don’t clamp down on Binance, Binance will destroy the economy of this country. They just fix the rate.
“We have saboteurs. Look at what Binance is doing to our economy. That is why the government moved against Binance. Some people sit down using the cyberspace to dictate even our exchange rate, hijacking the role of the CBN.
“They just sit down and fix anything they like. It’s a sabotage and we are trying to prevent that from happening henceforth.”
Onanuga urged Nigerians to stop patronising the parallel market for FX rates, saying the website of the apex bank is the only legal platform.
Naira grossly undervalued, says Cardoso
He said, “The parallel market is not the real gauge of Nigeria’s economic health. The parallel market is an illegal market.
“I don’t even know why Nigerians and the media are feeding on the parallel market. That is not where we should go; what’s the CBN rate? As at Friday, the rate for the dollar was about N1600.
“Even in the so-called parallel market, the exchange rate is stabilizing there and that is what this needs. Our economy is too much dollarised. Importers are looking at the exchange rate and using it to fix prices, some of them arbitrarily, some of them actually profiteering,” he said.
He noted that, once the CBN succeeds in stabilising the exchange rate, the prices of goods in the country will normalise.
“Things are not going to get worse, they are going to get better in the next few weeks,” he said.
Recall that, on Tuesday,the Governor of the Central Bank of Nigeria, Olayemi Cardoso, said illicit inflows in the form of crypto exchanges passed through Binance.
Cardoso said, “We are concerned that certain practices go on that indicate illicit flows going through a number of these entities [crypto platforms] and suspicious flows at best.
“In the case of Binance, in the last one year alone, $26bn has passed through Binance Nigeria from sources and users who we cannot adequately identify,” he added.
The CBN governor said anti-corruption agencies, the police and the Office of the National Security Adviser, Nuhu Ribadu, were co-ordinating an investigation into cryptocurrency exchanges.
Dollar will soon crash under Naira, Gov. Abiodun assures
Sources within the major telecommunication companies in the country told PREMIUM TIMES last week that the Nigerian Communications Commission (NCC) communicated the directive to telcos, and they immediately acted on the advisory.
Apart from Binance, other platforms such as Forextime, OctaFX, Crypto, FXTM, Coinbase, Kraken, among others, were equally blocked.
Presidency and regulatory sources said the government decided to move against Binance and other crypto firms following reports that currency speculators and money launderers were using them to execute criminal activities. Authorities believe the ‘criminal activities’ going on the platforms are contributing significantly to the weakening of the naira.
Binance, a digital assets platform, serves as a window for peer-to-peer transactions, allowing users to advertise interest to sell or buy currencies of their choice.
In September 2023, Nigeria’s Securities and Exchange Commission (SEC) disclaimed Binance Nigeria Limited, saying the platform was “neither registered nor regulated by the Commission and its operations in Nigeria are therefore illegal”.
Despite the warning by the regulatory agency, the firm continued its operation, attracting huge patronage especially among urban youths and suspected speculators and money launderers. Aside from suspicions of economic sabotage, officials also speak of national security concerns as the platforms are often patronised by other criminal groups, including for payments of ransom.
In its reaction last week, Binance said “users behaving in a manipulative way” would be removed from its platform.
“As industry leaders, we are working hand in hand with local authorities, lawmakers, and regulators to ensure we act on non-compliance,” the platform added, noting that it is “setting an upper limit for ads, filtering and removing bad ads, requiring and raising deposits for merchants posting ads as well as processes for actioning against any market manipulators.”
The Binance Detention…
Sources with details of the matter told this newspaper earlier in the week that the two executives of the online platform arrived in Nigeria on Sunday to negotiate with the government amid the crackdown.
On Monday afternoon, the executives met with top cyber security officials and other investigators from the office of the National Security Adviser to discuss the various areas of contention.
However, the meetings were deadlocked as Binance officials declined to meet some of the demands put forward by the Nigerian government.
They were also accused of operating a business worth billions without the requisite registrations and documentation.
According to sources who spoke with PREMIUM TIMES Wednesday evening, the Nigerian authorities requested Binance executives to provide data relating to transactions involving the Nigerian Naira on the Binance platform in the last seven years. They also demanded that some other data relating to Nigeria be deleted from the Binance platform.
However, the Binance executives insisted that they should be taken to their respective countries’ embassies before they could comply.
While the full identities of the two Binance executives remain sketchy as of press time Wednesday night, PREMIUM TIMES gathered that one of them is an American and the other a British-Pakistani.
The Nigerian government also obtained a court warrant to detain the officials for at least twelve days in the first instance.
A source with knowledge of the matter told PREMIUM TIMES that the investigation was consequently taken over by the Economic and Financial Crimes Commission (EFCC) while the two executives were detained at a guest house near the Office of the National Security Adviser.
The EFCC did not immediately respond to PREMIUM TIMES’ enquiries seeking clarity about the issue Wednesday night. Dele Oyewale, the spokesperson of the commission, told this newspaper to call back later.
Meanwhile, indications emerged Wednesday that Binance disabled its peer-to-peer function for Nigerian users on its platform.
More popularly known as P2P, the platform allows users, buyers and sellers to trade without third-party interference and became popular among Nigerians when the administration of former President Muhammadu Buhari banned cryptocurrency in 2021.
With the disabling of the P2P platform for Nigerian users, it remains unclear whether Nigerians would still be able to trade on the Binance platform.
Binance officials did not immediately respond to enquiries on the matter Wednesday as emails sent to their communication unit were not responded to.
Earlier on Tuesday, the Central Bank of Nigeria claimed that the sum of $26 billion flowed through Binance Nigeria over the past year from “unidentified sources”.
“In the case of Binance, in the last one year alone, $26 billion has passed through Binance Nigeria from sources and users who we cannot adequately identify,” Olayemi Cardoso, the CBN governor, said.
The apex bank governor also hinted that there is a collaboration among government agencies such as the Securities and Exchange Commission (SEC), the Economic and Financial Crimes Commission (EFCC), the Police, and the Office of the National Security Adviser (NSA) to address such illicit financial activities
CREDIT: Premium Times / Vanguard
