Binance, the global cryptocurrency trading platform, has identified two key conditions that must be fulfilled before it can consider registering under the Nigerian Securities and Exchange Commission’s (SEC) special framework program for Virtual Asset Service Providers (VASPs). This program is designed to regulate crypto platforms operating in Nigeria.
Binance’s stance comes in response to the SEC’s regulatory requirements, which include the obligation for cryptocurrency platforms to establish a physical office within Nigeria. These requirements are part of the broader framework introduced by Nigeria’s SEC to ensure compliance and oversight in the growing digital asset market.
According to a report by Nairametrics, the SEC’s framework governs virtual asset service providers and token issuers that engage in business within Nigeria or offer services to Nigerian consumers.
This includes platforms involved in the facilitation of virtual or digital asset offerings, trading, exchange, custody, and transfer. The goal of the framework is to create a more regulated and secure environment for crypto transactions, providing clear guidelines for companies operating in the digital asset space.
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As Binance weighs its options, its compliance with Nigeria’s regulatory landscape will be pivotal for its future operations in the country’s burgeoning crypto market.
Nigeria’s Minister of Information, Idris Mohammed, recently accused Binance of generating over $20 billion in turnover within the country in 2023 without paying taxes.
The federal government has initiated legal action against Binance, citing tax evasion, money laundering, and foreign exchange violations, though Binance denies these claims. A spokesperson for Binance emphasized that the platform will not consider joining the SEC’s program until these legal and regulatory issues are resolved.
A source at the SEC revealed that Binance continues to receive significant patronage from Nigerians and has not yet complied with the Commission’s framework, which requires all Virtual Asset Service Providers (VASPs) to establish an office in Nigeria under ARIP. While many VASPs have pending requests to join, the source expects Binance to eventually register.
Despite ongoing legal cases, Nigerians still use Binance, often through VPNs, although bank transfers are restricted. The SEC official clarified that foreign crypto firms must open a local office for regulatory oversight.