Binance exit sparks fears and opportunities in Nigeria’s crypto community

According to local crypto stakeholder Nathaniel Luz, Nigeria’s crypto ecosystem will see the rise of new crypto exchanges that will fill the vacuum created by Binance’s exit.

Local cryptocurrency stakeholders have lamented the current ban on Binance naira operations in Nigeria, stating it will affect the means of livelihood of many Nigerians and may increase youth unemployment in the country.

In separate interviews with Cointelegraph, local crypto stakeholders said the delisting of naira-related services from Binance will lead to the rise of new crypto exchanges, who will fill the vacuum created by Binance’s exit, while figuring out a way to remain compliant with local regulations.

The CEO of Flincap, a liquidity platform for crypto exchanges, Nathaniel Luz, said that several Nigerian traders make a living from trading P2P on Binance, that are now affected. However, they’ve currently resulted in trading on WhatsApp and Telegram groups.

Luz emphasized this development by saying:

According to the chief marketing officer of Flincap, Oladotun Wilfred Akangbe, the continuing uncertainty surrounding cryptocurrency regulation in Nigeria and the decision to seize operations of Binance can undermine the confidence of many people in the space. It can lead to massive fear, uncertainty, and doubt (FUD) in the crypto space in Nigeria.

In an official statement on its website, the Binance crypto exchange said it will automatically convert naira balances to USDT from March 8 at 8:00 am UTC but will cease support for NGN deposits after 14:00 UTC today.

According to the crypto company, withdrawals will become unsupported after March 8 at 6:00 am UTC, adding that the conversion rate for automatic conversions will be 1 USDT per 1,515.13 naira. Binance’s peer-to-peer platform delisted all NGN trading pairs in late February.

Related: Binance temporarily suspends Solana network withdrawals, citing ‘increased volume’

On Feb. 27, the governor of the Central Bank of Nigeria (CBN) argued that crypto exchanges in Nigeria were suspected of handling illicit transactions, pointing to “suspicious flows” of funds at Binance.

As the suspicions of Binance’s alleged illicit operations in Nigeria intensified, the Nigerian House of Representatives Committee on Financial Crimes called Binance CEO Richard Teng to appear before the committee before March 4.

In 2023, Nigeria’s Securities and Exchange Commission stated that Binance Nigeria wasn’t registered or regulated by them, marking its operations in Nigeria as illegal. In December 2023, the Central Bank of Nigeria reversed its stance on crypto assets, advising banks to ignore the previous ban on crypto transactions.