Cryptocurrency giant Binance has outlined two key conditions that must be met before it considers registering under Nigeria’s Securities and Exchange Commission’s (SEC) framework for Virtual Asset Service Providers (VASPs). This response comes as the Nigerian government increases its efforts to regulate the growing cryptocurrency sector in the country.
Nigeria’s Regulatory Push
Nigeria’s SEC has established a special framework aimed at regulating VASPs, which includes crypto platforms offering services like trading, exchange, and custody of virtual assets. The framework mandates that crypto platforms doing business with Nigerian consumers must register and maintain a physical presence in the country.
So far, the SEC has granted an Approval-in-Principle (AIP) to local crypto exchanges, such as Quidax and Busha, under the Accelerated Regulatory Incubation Programme (ARIP), a regulatory initiative designed to bring crypto platforms under Nigeria’s regulatory oversight.
Binance’s Two Conditions
In an exclusive interview with Nairametrics, a Binance spokesperson stated that the platform has two main conditions for joining Nigeria’s regulatory program:
1. **Release of a Detained Binance Executive:**
Binance is pushing for the release of its executive, Tigran Gambaryan, who was recently detained by Nigerian authorities over alleged foreign exchange manipulations. The platform insists that resolving this issue is crucial before it can explore participating in Nigeria’s crypto regulatory framework.
2. **Settlement of Legal Issues with Nigerian Government:**
Binance has been accused by the Nigerian government of conducting over $20 billion in transactions in 2023 without paying taxes. The government has initiated legal action against Binance for tax evasion and money laundering. Until these disputes are resolved, Binance stated that it cannot engage in the SEC’s program.
The spokesperson added, “We are pleased that Nigeria is progressing with its digital assets regime. However, until our legal challenges are resolved and our executive is released, joining the SEC’s program is not feasible.”
Binance’s Current Status in Nigeria
Despite not being officially regulated by the SEC, Binance continues to be widely used by Nigerian traders. According to a source at the SEC, Binance has not registered with the Commission because the platform already enjoys significant patronage from Nigerians. The source noted that Binance has not felt the need to comply with local regulations, as users can still access its services, albeit with certain limitations such as restrictions on bank transfers.
However, the source also suggested that Binance may eventually need to register due to the high number of Nigerians trading on the platform, especially as the SEC pushes for stronger regulatory oversight in the crypto space.
Looking Ahead
While Binance remains non-compliant with SEC requirements for now, ongoing legal pressures and regulatory developments could force the platform to reconsider its stance. The cryptocurrency landscape in Nigeria is rapidly evolving, and Binance’s future in the country may hinge on its ability to resolve its legal challenges and adapt to the regulatory environment.
