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Binance’s Exit Spurs Fear and Opportunity in Nigeria’s Cryptocurrency Community

Amid Nigeria’s regulatory pressures on cryptocurrency operations, the crypto ecosystem in Nigeria is set to witness the emergence of new crypto exchanges to fill the void left by Binance’s exit.

Local digital currency stakeholders lament the current ban on Binance’s naira operations in Nigeria, highlighting its impact on many Nigerians’ livelihoods and potential to increase youth unemployment. Separate interviews with Coin Telegraph revealed that local crypto stakeholders anticipate new digital currency exchanges filling the void created by Binance’s departure, adhering to local regulations.

Nathaniel Luz, CEO of Flincap, a liquidity platform for crypto exchanges, mentioned that several Nigerian traders making a living from peer-to-peer trading on Binance are now affected. However, Luz noted that some are trading in WhatsApp and Telegram groups. According to Oladotun Wilfred Akangbe, Chief Marketing Officer at Flinca, the ongoing uncertainty about digital currency regulations in Nigeria and the decision to cease Binance operations could weaken many people’s trust in this space, potentially leading to widespread fear, uncertainty, and doubt within Nigeria’s digital currency environment.

In an official statement on its website, Binance announced that from March 8 at 8:00 AM UTC, it would automatically convert naira balances to Tether, halting support for naira deposits from March 5 at 2:00 PM. Withdrawals will not be permitted from March 8 at 6:00 AM, with a conversion rate of 1 USDT for 1515.13 naira. Binance’s peer-to-peer platform removed all naira trading pairs in late February. On February 27, the Governor of Nigeria’s Central Bank, citing suspicious cash flows in Binance, argued that digital currency exchanges in Nigeria are suspected of handling illegal transactions.

Amid allegations of Binance’s illicit operations in Nigeria, the Nigerian House of Representatives’ Financial Crimes Committee asked Richard Teng, CEO of Binance, to appear before the committee by March 4, 2023. The Nigerian Securities and Exchange Commission announced that Binance Nigeria is not registered or regulated by the agency, rendering its operations in Nigeria illegal. In December 2023, the Central Bank of Nigeria shifted its stance on digital assets, advising banks to disregard the previous ban on cryptocurrency transactions.

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