The Nigerian Securities and Exchange Commission (SEC) has delivered a decisive blow to the operations of cryptocurrency exchange giant Binance, stating that its activities within the country are illegal. In a recent notice issued on Friday, the SEC also directed all crypto platform providers to refrain from soliciting Nigerian citizens. The regulatory authority reiterated its firm stance on viewing all cryptocurrencies as securities and disclosed ongoing negotiations with the central bank regarding registration of crypto exchanges. This article delves into the implications of the SEC’s latest action and its impact on the broader cryptocurrency landscape in Nigeria.
Binance’s Illegitimate Status:
According to the SEC’s official notice, Binance’s activities in Nigeria, conducted through its website, https://www.binance.com, are not registered or regulated by the commission. The SEC reaffirmed its previous warning from June 9, where it referred to a company named Binance Nigeria Ltd., which the crypto exchange denied any affiliation with. However, in the latest notice, the SEC explicitly pointed to Binance’s website, emphasizing the company’s unregistered and illegal operations in the country.
SEC’s View on Crypto as Securities:
The Nigerian SEC’s classification of all cryptocurrencies as securities further complicates the regulatory landscape for crypto-related businesses in the country. Although the commission had been evaluating crypto exchange applications on a trial basis, registration will not be completed until an agreement is reached with the central bank. The bank’s restriction on local financial institutions from engaging with crypto services providers has been a significant hurdle for the industry.
Warning to the Public:
The SEC’s notice extended beyond Binance, cautioning the public to exercise caution when investing in crypto assets and products offered by entities not registered or regulated by the commission. In a bid to safeguard Nigerian investors, the regulatory body firmly directed all platform providers soliciting investments to immediately cease all forms of solicitations within the country.
The Nigerian SEC’s unequivocal declaration of Binance’s activities as illegal and its stern warning to all crypto platform providers underscore the government’s determination to regulate the cryptocurrency space. With the commission viewing all cryptocurrencies as securities, the regulatory environment for crypto-related businesses in Nigeria remains uncertain. As the SEC continues its negotiations with the central bank regarding registration and interacts with the industry, the future implications of this notice on the broader crypto landscape in Nigeria are yet to be fully realized.