🚀 Crypto Exchanges in Nigeria Cease Naira Purchases of USDT and USDC Amid Central Bank Scrutiny

A number of cryptocurrency companies in Nigeria have chosen to prohibit the purchase of USDT and USDC stablecoins using Naira.

Nigerian crypto exchanges stop buying USDT and USDC with Naira due to Central Bank investigation Report

Last updated: February 28, 2024 11:13 EST | 2 min read

Several crypto companies in Nigeria have made the surprising decision to disallow users from buying the Tether (USDT) and USD Coin (USDC) stablecoins with Naira. This move comes amidst renewed scrutiny from the Central Bank of Nigeria (CBN). Regulators are becoming increasingly concerned about the speculative trading and potential market manipulation facilitated by crypto platforms 🤔.

The decision to suspend the trading of these stablecoins was reportedly made during a secretive meeting of crypto founders, where participants unanimously agreed to take this action. Though details of the meeting have not been disclosed, it is believed that at least two crypto exchanges have already notified their Nigerian customers about this new development 😱.

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Notifications sent to customers explicitly stated that the buying and selling of USDT and USDC with Naira would no longer be possible. 🚫

The regulatory scrutiny faced by crypto exchanges is not new. Recent reports have highlighted the difficulties in accessing the websites of popular platforms like Coinbase, Quidax, and Binance. In fact, the Central Bank governor, Olayemi Cardoso, claims that an estimated $26 billion has passed through Binance Nigeria from unidentified sources and users, further intensifying regulatory concerns 😱.

The Digital Currency Coalition, an autonomous group, has also alleged that speculative trading on the platform played a significant role in the devaluation of the Naira against USDT by 113.1% since February 2023. Scary, right? 😨

But it gets even more concerning. Unverified reports have emerged suggesting that two executives from a crypto company were arrested, possibly in an attempt to force the company to disclose its Know Your Customer (KYC) data. However, Zakari Mijinyawa, a special adviser to Nigeria’s National Security Adviser, has claimed that he is not aware of any arrests and suggested that law enforcement agencies could have taken independent action 😮.

Amidst all these developments, crypto exchanges in Nigeria are proceeding cautiously. Some employees have even reported receiving instructions not to wear company-branded apparel or attend events related to platforms like Binance. It seems like uncertainty and fear are once again gripping the crypto community in the country 🤐.

This climate of uncertainty reminds us of last year when the Securities Exchange Commission announced that Binance was operating illegally in the country. It seems like Nigeria’s crypto journey has been full of twists and turns 👀.

🛑 Binance Implements Price Cap for USDT

In response to local regulatory requirements, Binance has recently introduced a price cap for Tether (USDT) tokens on its peer-to-peer (P2P) platform in Nigeria. Traders on Binance’s P2P platform are now restricted from selling USDT above the set cap of 1,802 naira per USDT.

Those who attempt to sell USDT above the imposed limit will find their accounts blocked. Binance is taking steps to comply with the regulations while still allowing users to trade within the prescribed limits 📊.

Q&A

Q: Is this a temporary measure or a permanent ban on buying USDT and USDC with Naira?
A: The decision to disallow buying USDT and USDC with Naira has been made by several crypto companies in Nigeria. While it’s unclear whether this is a temporary measure or a permanent ban, it reflects the intensified regulatory scrutiny faced by crypto platforms in the country.

Q: How will this affect crypto traders and investors in Nigeria?
A: The suspension of buying USDT and USDC with Naira could have significant implications for crypto traders and investors in Nigeria. It may limit their ability to trade or invest in these stablecoins, potentially leading to decreased liquidity and increased volatility in the market.

Q: What are the underlying reasons for the Central Bank’s scrutiny of crypto platforms?
A: The Central Bank of Nigeria has expressed concerns about speculative trading and potential market manipulation facilitated by crypto platforms. It is likely aiming to protect investors and maintain financial stability in the country.

Future Outlook

The future of crypto in Nigeria remains uncertain. With the regulatory landscape tightening and the authorities showing a keen interest in blockchain technology, it is vital for industry players to adapt and find ways to navigate the changing environment.

While the current situation may seem daunting, there is still hope for the future. The crypto community in Nigeria is strong and resilient, and with the right regulatory framework and support, the industry can flourish once again.

In conclusion, the recent decision by crypto exchanges in Nigeria to disallow the purchase of USDT and USDC with Naira reflects the increasing regulatory scrutiny faced by the industry. This presents challenges for traders and investors, but also an opportunity for the crypto community to come together, adapt, and thrive in the face of adversity.

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References: 1. Crypto Exchanges in Nigeria Cease Naira Purchases of USDT and USDC Amid Central Bank Scrutiny 2. Tether (USDT) 3. USD Coin (USDC) 4. Accessing the websites of popular platforms 5. Coinbase 6. Quidax 7. Binance 8. Nigeria’s crypto journey

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