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Nigeria Sues Binance for $26 Billion Tax Evasion; The Battle for Cryptocurrency Regulation in Africa

The Nigerian government declares war on crypto as citizens embrace it

Nigeria Sues Binance for $26 Billion Tax Evasion; The Battle for Cryptocurrency Regulation in Africa

Nigeria has taken legal action against two senior executives of Binance, the world’s largest cryptocurrency exchange, over allegations of tax evasion worth $26 billion. Along with the prosecution, the country is seeking a fine of $10 billion from Binance for the tax evasion charges. One of the managers managed to escape arrest, while the government is actively pursuing the recovery of the alleged tax evasion funds from the company.

Despite being a leading country in digital currency adoption, Nigeria banned Binance under the guise of tax evasion charges. This move is surprising given that a significant portion of Nigerian citizens own cryptocurrencies. The popularity of crypto in Nigeria is driven by factors like devaluation of local currency naira and prompting citizens to seek ways to preserve their wealth. However, despite these challenges, many citizens have turned to cryptocurrencies like Bitcoin as a more stable alternative to the faltering naira. Consequently, Nigeria has emerged as a leading market for decentralized crypto trading.

The economic challenges in Nigeria have led to a devaluation of naira and increased inflation. This has significantly impacted purchasing power of Nigerian consumers despite efforts by new government policies aimed at curbing capital outflows and targeting Binance as an easy regulatory target. The government’s crackdown on Binance can be seen as an attempt to control devaluation of naira and prevent further capital outflows from country.

Binance’s suspension of operations in Nigeria has left millions users in limbo due to complex regulatory history including a tax evasion case in US which influenced government decision limit exchange activities in Nigeria . The allegations raised against binance managers have raised concerns about potential diplomatic crisis with US and UK governments where one manager remains in custody while another escaped arrest warrant sought globally by authorities

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