Binance, one of the leading crypto exchanges, has said it will discontinue all Nigerian naira services on March 8. The crypto exchange’s decision to drop trading pairs that feature the naira follows weeks of attacks and an official crackdown on its Nigerian operations. Crypto experts like Oladotun Wilfred Akangbe believe dropping the naira will temporarily create a gap in the market.
Increased Scrutiny of Binance’s Nigerian Operations
The embattled cryptocurrency exchange, Binance, has announced it will cease all services involving the Nigerian naira (NGN) starting March 8. The crypto exchange, which reportedly serves approximately 10 million clients in Nigeria, has already urged users to withdraw their naira assets or convert them to cryptocurrency before the deadline.
Binance’s decision to discontinue naira services follows weeks of heightened scrutiny of its operations. This scrutiny began after some Nigerian officials accused Binance of contributing to the local currency’s rapid depreciation through its peer-to-peer cryptocurrency trading platform. Initially, Binance reportedly tried to appease the increasingly vocal Nigerian politicians by setting an upper limit for the naira to USDT exchange rate.
However, this did not stop officials from making further demands, including the release of the names of Binance’s users in Nigeria. As recently disclosed by a local blockchain advocacy group, Binance’s refusal to release the list is what led Nigeria to detain the company’s visiting executives.
A Temporary Gap in the Market
Since then, Nigerian officials have escalated their campaign against Binance, with an aide to the Nigerian leader even threatening a multi-billion dollar fine. While Binance does not provide reasons for the discontinuation, its statement suggests that the company’s executives are keen to end the controversy.
“After 2024-03-08 08:00 (UTC), Binance will convert any remaining NGN balances in users’ spot and funding wallets into USDT on behalf of users at a ratio of 1 USDT = 1,515.13 NGN. The conversion may take approximately up to 24 hours or longer. USDT tokens will be credited to users’ spot wallets thereafter,” Binance said in its March 5 statement.
The statement also revealed that Binance P2P delisted all NGN trading pairs on Feb. 28.
Commenting on Binance’s decision to discontinue naira services, Oladotun Wilfred Akangbe, the CMO at Flincap, warned of potential problems for Nigerians who patronize the crypto platform.
“Having a crypto-to-local currency pair has several benefits. It allows users to trade and hold funds easily between local fiat and cryptocurrencies. With this development, traders have to find a way to make their trades quickly while using the platform easily. It will affect the accessibility and convenience of use for Binance users in Nigeria,” Akangbe told Bitcoin.com News.
However, according to the CMO, Binance’s decision to drop the trading pairs featuring the local currency will temporarily create a gap in the market. Akangbe insisted that other cryptocurrency exchanges will eventually fill this gap.