Crackdown on Binance: Nigeria Court Orders the Exchange to Disclose Customers’ Data

A federal court in Nigeria has ordered Binance to disclose the data or information of all persons on its platform from the country to the Economic and Financial Crimes Commission (EFCC). The interim order by Justice Emeka Nwite came with the ruling on the ex parte motion moved by the lawyer representing the anti-corruption body.

A Nigerian Court Order against Binance

“The applicant’s application, dated and filed 29th February 2024, is hereby granted as prayed,” the Justice wrote. “That an order of this honourable court is hereby made directing the operators of Binance to provide the commission with comprehensive data/information relating to all persons from Nigeria trading on its platform,” the judge ordered.

The order would enable Nigeria’s investigative agency to unravel the alleged money laundering and terrorism financing with cryptocurrencies using Binance.

Binance’s Role in Naira Devaluation

Nigeria’s sudden crackdown on Binance came in late February when the country’s authorities detained two executives of the crypto exchange platform. A report by the BBC revealed that the Nigerian authority is demanding $10 billion from the cryptocurrency exchange as retribution, but the country’s officials said that amount is only under consideration and no such demands were made.

Meanwhile, the crypto exchange has already terminated all trading activities on its platform using Nigeria’s local currency, naira. Interestingly, the value of the naira has dived significantly in the last year, dropping over 70 percent of its value against the US dollar. An operative of Nigeria’s EFCC also blamed Binance’s role in manipulating the currency market, resulting in the devaluation of naira.

“The team uncovered users who have been using the platform for price discovery, confirmation, and market manipulation, which has caused tremendous distortions in the market, resulting in the Naira losing its value against other currencies,” a motion filed by the EFCC representative noted.

“That the damage the platform has caused was clearly explained to the operators of the platform, and they were requested to delist the Naira and avail the ONSA on the activities of the Nigerians on their platform… That from the information afforded to the team by Binance shows that the total trading volume from Nigeria in 2023 alone stood at $21.6 million.”