The Nigerian Bureau De Change Association (ABCON) is escalating its efforts to urge the Federal Government to ban the activities of Binance, a leading cryptocurrency trading platform. This call comes as the association identifies Binance as a contributing factor to pressure on the nation’s currency, the naira.
ABCON’s Concerns
The Association of Bureau De Change Operators of Nigeria (ABCON), a self-regulatory body representing central bank-licensed Bureaux de Change (BDC), has expressed growing concerns over Binance’s impact on the naira’s value. According to Alhaji Aminu Gwadabe, the president of ABCON, Binance has become a focal point for both the Investor and Exporters window as well as the parallel market.
Gwadabe notes that the platform’s remarkable liquidity, averaging 1.2 million transactions per second, poses a competitive challenge. To address this, Gwadabe proposes that the most effective approach is to prohibit Binance’s operations and bolster liquidity.
Gwadabe underscores a shift from positive to negative sentiment in Nigeria’s foreign exchange market, emphasizing the potential impact on citizen confidence and global currencies. He highlights the association’s belief that restricting Binance’s activities could mitigate this trend.
SEC’s Advisory and Binance’s Response
The Nigerian Securities and Exchange Commission (SEC) issued a warning on July 28, advising domestic investors to avoid engaging with Binance. The advisory referred to a prior circular addressing the misuse of the Binance brand by a fraudulent entity.
Binance responded by sending a cease and desist notice to Binance Nigeria. The regulatory agency reaffirmed that Binance lacked authorization to operate within Nigeria, stressing its violation of the law.
Nigeria’s Regulatory Approach
Nigeria has adopted a vigilant stance toward the cryptocurrency sector, concurrently advancing its central bank digital currency (CBDC) initiatives. In July, the country upgraded the CBDC system with near-field communication technology to enhance contactless payments.
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