Nigeria’s market regulator declares Binance’s operations illegal and demands immediate discontinuation.

Nigeria’s Securities and Exchange Commission (SEC) has issued a directive ordering Binance, the world’s largest cryptocurrency exchange, to halt its operations in the country. The SEC stated that Binance Nigeria Limited, which had been targeting Nigerian investors through its website, was operating illegally as it was not registered or regulated.

This move comes after the SEC of Nigeria introduced regulations for digital assets last year, indicating the country’s intention to find a balance between outright banning cryptocurrencies and allowing their unregulated use. In 2021, the Central Bank of Nigeria had banned banks and financial institutions from dealing in or facilitating transactions involving digital currencies.

However, Nigeria’s tech-savvy and young population has shown great interest in cryptocurrencies, with many turning to peer-to-peer trading offered by crypto exchanges to bypass the ban imposed by the financial sector.

In a separate development, the US affiliate of Binance, known as Binance.US, announced that it would halt dollar deposits and advised customers to withdraw their funds by a specified deadline. This decision came after the US Securities and Exchange Commission filed a lawsuit against Binance, its CEO Changpeng Zhao, and the operator of Binance.US, marking an escalation in regulatory actions against the cryptocurrency industry. The SEC also sued major US exchange Coinbase a day later.

Binance.US, in a customer notice posted on Twitter, mentioned that its banking partners were preparing to suspend dollar withdrawal channels as early as June 13. The exchange stated that it would transition to a “crypto-only exchange” and called the SEC’s civil charges “unjustified,” vowing to vigorously defend itself against the allegations.

These recent developments reflect the growing scrutiny and regulatory challenges faced by Binance and the wider cryptocurrency industry globally, as regulators attempt to establish frameworks and address concerns related to investor protection, financial stability, and compliance with anti-money laundering and know-your-customer regulations.