Did Binance Just Destabilize an Entire National Currency?

As the world's largest cryptocurrency platform, Binance is the Bitcoin of exchanges. When Bitcoin makes a splash, the entire market rises with the tide. But when Binance makes a splash, markets start to drown.

Although not quite triggering tsunami levels of concern like FTX, Binance has still managed to sink an entire national currency.

Binance Held as Hostages

Last week, we reported that Nigeria’s Department of State Security detained two Binance executives and confiscated their passports. The Central Bank of Nigeria's governor, Olayemi Cardoso, said Binance Nigeria "witnessed suspicious flows” of money in 2023.

It has since been revealed that the two Binance officials were Tigran Gambaryan, Binance’s head of financial crime compliance, and Nadeem Anjarwalla, a U.K. and Kenyan national and Binance’s regional manager for Africa.

More interestingly still, the two executives were in Nigeria to address allegations that the exchange's activity had crashed the country's national currency, the naira.

The Nigerian government are holding the employees in a guarded house but has not charged them with any crimes. A source briefed on the situation said the executives were being held “simply as hostages” but were being well-treated.

Cryptocurrency adoption has increased substantially in Nigeria as the country faces crippling inflation. In January, Nigeria's inflation rate hit close to 30%.

National economic restrictions aimed at battling inflation such as rationing who could exchange the naira for the dollar and specific rates encouraged locals to turn to digital assets such as stablecoins.

Consequently, Nigeria has the second-highest adoption of crypto in the world, only behind India.

Bayo Onanuga, a special adviser to the Nigerian president, accused Binance of artificially determining the Naira's exchange rate and eating into the central bank's role.

“Crypto should be banned in our country or else this bleeding of our currency will continue unabated,” Onanuga said on X.

The Naira-Dollar manipulators

I chanced on an X post Tuesday night by one Brother Bernard @Mikael C Bernard who railed against what he called the order of the EFCC, NSA on Finance to set a cap on traders selling USD tokens for Naira equivalent.

He disclosed that token sellers… pic.twitter.com/c9YBjawJMz
— Bayo Onanuga (@aonanuga1956) February 21, 2024

Olayemi Cardoso, the head of Nigeria’s central bank, alleges that crypto platforms were being used to manipulate the market.

The government has ordered telecommunications companies to block access to Binance's website, as well as other crypto platforms. Cardoso said $26 billion of untraceable passed through Binance over the year.

Binance has denied these allegations and has stated that “we are working collaboratively with Nigerian authorities to bring Nadeem and Tigran back home to their families.”

A court order has allowed their detention for 14 days, ending Tuesday, with an extension hearing scheduled for Wednesday.

Furthermore, Nigeria wants Binance to hand over information on its top 1,000 users in the country and transaction history over the past six months.

Binance is blocked in the UK, Netherlands, Canada, Malaysia, and the US (although Binance.us operates as a separate entity), and might soon be banned in the Philippines.

CZ Says Changpeng Ciao to His Passport

It's been almost four months since Binance founder Changpeng Zhao stepped down as CEO and pled guilty to federal criminal charges of violating the Bank Secrecy Act.

Originally set for sentencing on 23 February, Zhao's fate has since been pushed back to April. He must await his sentencing in the US as he faces 18 months to 10 years in prison.

In the latest update, a federal judge has made further restrictions on Zhao's bond conditions. U.S. District Judge Richard A. Jones stated that Zhao must notify the court of travel within the U.S. and must surrender his passport.

Zhao has been asked to surrender his Canadian passport to a third-party custodian employed by his lawyers, who must accompany Zhao on any travel that requires identification papers.

All current or expired passports must be handed to his lawyers too and Zhao cannot apply for a new passport without the court's permission.

BS But No BO

Amidst all the chaos, Binance's marketing team has been busy pushing a new product: Binance perfume.

Perhaps drawing inspiration from the likes of Beyonce and Rihanna, Binance has deemed it fitting to launch its own brand of perfume to capitalize on its brand image, right in time for International Women's Day.

There’s still not enough women in crypto.

We've launched our new fragrance ‘CRYPTO’ as a new way to open up conversations with the public on what needs to be done to bridge the gender gap.

Find out more 👉 https://t.co/z2ICGrhSnC pic.twitter.com/LDTtLWME4o
— Binance (@binance) March 6, 2024

Aptly named "CRYPTO," Binance's fragrance is aimed to allure more women into the crypto world. "We've launched our new fragrance ‘CRYPTO’ as a new way to open up conversations with the public on what needs to be done to bridge the gender gap," Binance said in a marketing video.

No price has been revealed, nor how one can actually purchase the product, but we're not convinced the perfume can mask Binance's shady financial behaviour. Don't waste your winnings on this one.