Regulation
Nigeria bans P2P crypto trading, cites concerns over Naira
Nigeria’s Securities and Exchange Commission (SEC) has announced plans to ban peer-to-peer (P2P) cryptocurrency trading in a significant regulatory move. The development is part of a broader crackdown that includes the arrest of two Binance executives.
Indeed, the application of Nigerian regulations is intensifying tensions within the crypto sector. This also raises concerns among global crypto entities regarding the regulatory environment in the region.
Nigeria to tighten regulations as Binance affair continues
Emomotimi Agama, Director General of the SEC, has expressed serious concerns over the effects of P2P trading on the Nigerian Naira. Agama stressed the urgency of these measures stabilize the national currency.
“What needs to be done is to remove the naira from the P2P space in order to avoid the level of manipulation that is happening now. […] Recent concerns over P2P crypto traders and their perceived impact on the naira exchange rate have highlighted the need for collective action,” Agama said.
Peer-to-peer platforms allow direct exchanges between crypto investors and bypass intermediaries. Therefore, the method may have raised concerns among Nigerian regulators.
Additionally, Nigerian officials have previously claimed that Binance and several other crypto exchanges engaged in fixing prices in dollars. These prices did not refer to the price of the Nigerian naira at the central bank.
This ultimately prompted speculators to take a chance and make prices on crypto exchanges the standard price used for foreign exchange trading. The question is particularly interesting considering that Nigeria fought against inflation.
Learn more: How to protect yourself from inflation using cryptocurrency
Nigeria Inflation Rate. Source: Bloomberg
As Nigeria grapples with economic instability, the SEC’s approach aims to curb activities perceived as threats to the financial sector. security. This initiative extends to upcoming regulations targeting crypto exchanges and digital asset custodians.
The regulator’s aggressive posture was highlighted earlier this year following Binance’s trading ban and subsequent ruling. detention of its senior executives, Tigran Gambaryan and Nadeem Anjarwalla. Although Anjarwalla managed to escape, Gambaryan was arrested in Abuja. He also faces charges, including tax evasion and money laundering, which will lead him to be tried this month.
In response to the ongoing case between the company and the Nigerian SEC, Richard Teng, CEO of Binance, publicly called for Gambaryan’s release. In an open letter published on May 7, Teng criticizes Nigerian authorities for setting a “dangerous precedent” for global corporate engagements. Additionally, Teng defended Gambaryan’s integrity and professional experience, particularly his global contributions to the fight against financial crime.
“It is important to note that Tigran did not go to Nigeria as a “decision maker”, nor as a “negotiator”. He was simply acting as a functional expert on financial crime and capacity building in policy discussions,” Teng said. declared.
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This is not the first time Binance has publicly called for the release of its executives. In early April 2024, Binance collectively published a statement “respectfully requesting that Tigran Gambaryan not be held accountable while ongoing discussions are ongoing between Binance and Nigerian government officials.”
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