Binance, OctaFX, Coinbase, others blocked amid forex crisis

The Federal Government has taken action against the online platforms of Binance and other cryptocurrency firms, alleging manipulation of the forex market. Binance, a digital assets platform facilitating peer-to-peer transactions, allows users to advertise their interest in buying or selling currencies of their choice.

On February 5, 2021, the Central Bank of Nigeria (CBN) issued a directive to banks, non-bank financial institutions (NBFIs), and other financial institutions (OFIs) to close accounts associated with individuals or entities involved in cryptocurrency transactions.

The regulator cautioned local financial institutions against engaging in crypto assets or facilitating payments for crypto exchanges, citing concerns over money laundering, terrorism financing, cybercrime, and the volatility of cryptocurrencies.

In December 2023, the CBN reversed its stance on crypto assets and instructed banks to disregard the February 2021 ban on crypto transactions.

The recent restriction on crypto websites aims to curb currency speculation activities in the country, with Binance clarifying that its platform is not designed for currency pricing.

Bayo Onanuga, Special Adviser to President Bola Tinubu on Information and Strategy, advocated for a ban on Binance and other crypto platforms in Nigeria, noting restrictions faced in jurisdictions like the United States, Singapore, Canada, and the United Kingdom.

In response, Binance emphasized that it does not function as a price discovery platform, and FX rates are influenced by complex forces unrelated to the company. The platform provides a market-driven peer-to-peer (P2P) platform without intending to serve as a proxy for currency pricing in Nigeria.

Users on the platform have expressed dissatisfaction with their inability to purchase dollars. The restricted platforms include Binance, Forextime, OctaFX, Crypto, FXTM, Coinbase, Kraken, Kucoin, Bybit, and several others used in cryptocurrency transactions in Nigeria.