Major cryptocurrency exchange Binance has announced its decision to suspend all services involving the Nigerian naira (NGN) following increased regulatory scrutiny in Nigeria. The move comes amidst allegations of illicit transactions and “suspicious flows” of funds at Binance, as pointed out by the governor of the Central Bank of Nigeria.
In an official statement released on March 5, Binance declared the discontinuation of all services in NGN, with NGN withdrawals set to be suspended after March 8. The remaining NGN balances in users’ accounts will be automatically converted to the Tether stablecoin from that date.
Binance has urged its users to withdraw NGN, trade their NGN assets, or convert them into cryptocurrencies before the cessation of NGN services. The conversion rate will be determined based on the average closing price of the USDT/NGN trading pair on Binance Spot over the past seven days.
NGN deposits have already been halted, with transactions not supported after 2:00 pm UTC on March 5. Furthermore, all trading pairs involving NGN are scheduled to be removed on March 7, and Binance Pay will no longer support NGN as a payment option from March 6.
The decision follows the delisting of all NGN trading pairs on Binance’s peer-to-peer platform in late February. The move is seen as a response to growing regulatory concerns in Nigeria, where the National Security Adviser reportedly confiscated the passports of two Binance executives, both citizens of the United States and the United Kingdom.
Regulatory challenges escalated on February 27 when the Central Bank of Nigeria governor accused crypto exchanges, including Binance, of facilitating illicit transactions. The Nigerian House of Representatives Committee on Financial Crimes issued an ultimatum to Binance CEO Richard Teng to appear before the committee before March 4.
Nigeria, previously recognized as a burgeoning crypto economy, faces increasing regulatory resistance. In September 2023, Chainalysis ranked Nigeria second globally in cryptocurrency adoption. However, an adviser to Nigeria’s president recently called for a ban on Binance, KuCoin, and other crypto trading platforms in the country.
This move by Binance echoes the stance taken by Nigeria’s central bank two years ago when it prohibited regulated financial institutions from offering services to crypto exchanges. As the regulatory landscape evolves, the fate of cryptocurrency adoption in Nigeria remains uncertain.