A director at the Security and Exchange Commission (SEC), Abdulkadir Abbas, has revealed how cryptocurrency exchange platform, Binance Holding Limited, used its Naira peer-to-peer (P2P) virtual feature to devalue the Nigerian currency.
Abbas, who identified himself as Director of Exchanges and Market Infrastructure (SEC), told Justice Emeka Nwite on Friday that the Naira P2P feature deployed by Binance and the number of people on the platform adversely affected the official exchange rate.
Led in evidence by counsel for the Economic and Financial Crimes Commission (EFCC), Ekele Iheanacho, the SEC director said Binance operated a trading platform that was not registered or regulated by the commission and was in breach of the extant provision of relevant laws in Nigeria
He added that Binance engaged in public solicitation of Nigerians without permission by SEC.
Abbas said: “The first defendant (Binance) operates a Naira Peer-to-Peer transaction in exchange for the crypto asset.
“As a matter of fact, the Binance platform became a reference point for determining the exchange rate.”
The director said the Binance model invariably created uncertainty and Nigeria’s exchange values were raised arbitrarily on the platform, thereby impacting negatively on the country’s financial system stability.
“The Naira P2P deployed on the Binance website affects the values of our Naira.
“This is one serious concern raised at the meeting we had at the office of the National Security Adviser,” he added.
On the relationship between the rates on the Binance platform and the official exchange rate, the witness said the Naira P2P rate was not guided by any fundamental principles.
“It reached a stage where if one wants to exchange the US dollars, Nigerians will go to the Binance platform for a rate that does not correlate with Nigeria’s official rate,” he concluded.
By: Babajide Okeowo
If you like what we do, and are ready to uphold solutions journalism, kindly donate to the Ripples Nigeria cause.
