Binance, the world’s largest crypto exchange, has announced it will stop all support for the Nigerian naira (NGN) by March 8, 2024. This abrupt decision to exit comes as Binance faces rising regulatory pressure in Nigeria.
According to a blog post published on March 5th, Binance will halt NGN deposits starting at 14:00 UTC. The exchange will also disable withdrawal functionality two days later, at 06:00 UTC.
Perhaps most importantly, any NGN still sitting in Binance accounts after 08:00 UTC on March 8th will be forcibly converted to USDT. The conversion is at a rate of 1 USDT to every 1,515 NGN. Binance cited the average USDT/NGN closing price over the past seven days as its conversion benchmark.
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Binance’s decision following Nigerian scrutiny
This decision appears directly linked to Nigerian authorities ramping up investigations into Binance’s unregulated operations within Nigeria this year.
While Nigerian authorities have not completely banned cryptocurrencies to date, regulators have demonstrated a clear distrust of the asset class emerging as an alternative to the naira within its borders.
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Binance held a dominant position in allowing this growth as the most trafficked exchange in the world. However, by forcing Binance to surrender its naira foothold, regulators may aim to stifle wider adoption before it truly flourishes.
Nigerians trade millions of dollars’ worth of crypto each month. So regulators probably realized that allowing Binance to continue mainstreaming cryptocurrencies would severely restrict their control.
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It remains to be seen whether Nigeria will outright criminalize crypto usage next. But for now, traders will have to take their business elsewhere or risk getting caught in the crosshairs of intensifying regulation.