In a move to comply with local regulations in Nigeria, Binance has enforced a limit on the selling price of Tether tokens (USDT) on its peer-to-peer (P2P) platform. Traders using Binance P2P are now unable to sell USDT above the set cap of ₦1,802 per USDT.
Binance has communicated its dedication to collaborating with Nigerian authorities, lawmakers, and regulators to uphold the price cap and ensure adherence among users. The P2P platform facilitates direct buying and selling of cryptocurrencies for fiat currency between users.
Nigerian Authorities Collaborate to Tackle Forex Speculation
The Office of the National Security Adviser in Nigeria, in conjunction with the Central Bank of Nigeria (CBN), launched a joint effort to combat forex speculation and address issues impacting the country’s economic stability.
The initiative aims to address the significant role played by speculators, both domestic and international, in the depreciation of the naira, exacerbating inflation and contributing to economic instability.
The Nigerian government’s decision to unify forex windows in mid-2023 resulted in a considerable depreciation of the naira against the United States dollar on the foreign exchange market. The exchange rate doubled from approximately ₦700 per dollar to a historic high of over ₦1,500 per dollar.
Regulatory Scrutiny on Binance in Nigeria
In July 2023, the Nigerian Securities and Exchange Commission (SEC) cautioned local investors against using Binance, citing its lack of operating license in the country and the illegality of its operations. The SEC also emphasized the high risk associated with investing on the platform and the potential for total loss of investments.
Nigeria currently stands as the world’s largest P2P cryptocurrency market, a status it attained after the Central Bank of Nigeria prohibited institutions from engaging in cryptocurrency transactions in 2021. However, a circular issued to banks in December 2023 lifted the ban, allowing Nigerian banks to facilitate cryptocurrency transactions.
