Its a big move, nigeria market Organizer He directed the suspension of operations of Binance, the world’s largest cryptocurrency exchange, within the country. The regulator stated that the local unit of the stock exchange, which was attracting Nigerian investors through its website, was operating illegally.
Binance and its affiliates continue to find themselves in increasingly turbulent waters, as they grapple with a series of challenges in the wake of a recent lawsuit filed by the US Securities and Exchange Commission (SEC).
The lawsuit has caused significant legal and regulatory difficulties for the cryptocurrency exchange and associated entities. This week, the Securities and Exchange Commission (SEC) took legal action against both Binance and Coinbase, accusing them of violating its regulations.
Nigeria’s regulatory stance casts doubt on Binance’s future
Last year, the Securities and Exchange Commission of Nigeria took a big step by publishing a comprehensive set of regulations specifically designed for digital assets. The move showed that Africa’s most populous country was actively looking for a balancing act between outright banning cryptocurrencies and their unregulated use.
By implementing these regulations, Nigeria aims to create a regulatory framework that will enable the responsible and secure use of crypto assets within the country while addressing potential risks and concerns.
In light of the recent developments, the Securities and Exchange Commission issued a warning to Nigerians, warning them against dealing with the aforementioned entity. The exchange has emerged as a prominent cryptocurrency platform in Nigeria, and established itself as a market leader after the collapse of FTX.
In 2022, Binance was in talks with the Nigerian Export Processing Zones Authority (NEPZA) to create a virtual free zone centered around blockchain and the digital economy. However, with the regulatory challenges facing Binance and the SEC warning, the future of such initiatives remains uncertain.
Furthermore, the agency has directed the cryptocurrency exchange to stop facilitating investments from Nigerian individuals on its platform. I have explicitly warned that regulatory action may be taken against cryptocurrency exchanges, including Binance.
Binance Nigeria Limited is neither registered nor regulated by the Commission and therefore its operations in Nigeria are illegal. Any member of the investing public doing business with the entity does so at their own risk.
Binance faces constant scrutiny from multiple regulators
In the midst of these challenges, Binance.US has made the important decision to transition to a “crypto-only exchange.” As part of this shift, Binance.US has announced its intention to remove all USD trading pairs from its platform by June 13.
The move signals a strategic shift in focus towards providing services exclusively to cryptocurrency trading activities. The exchange made the decision to exit the Canadian market in May, citing the unfavorable regulatory environment as the reason behind the move.
Prior to that, the company also revoked its derivatives license with the Australian Securities and Investments Commission (ASIC). The Australian financial regulator has raised concerns and has begun reviewing Binance’s compliance with local laws.
Featured image from UnSplash, chart from TradingView.com