Nigeria intensifies probe into Binance with court-ordered data disclosure Nigeria intensifies probe into Binance with court-ordered data disclosure
Binance's privacy terms show that it could share users' data with authorities for legal and regulatory compliance reasons.
2 min read
Updated: Mar. 18, 2024 at 8:08 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
A Federal High Court in Nigeria has ordered Binance to provide detailed information on all its Nigerian users to the country’s foremost anti-corruption agency — the Economic and Financial Crimes Commission (EFCC).
The ruling comes amid rising tensions between the crypto exchange and Nigerian authorities over the past month as the country’s fiat currency collapsed after locals turned to crypto to deal with unabated inflation.
Nigeria has blamed its unstable economic conditions on Binance and believes the exchange has helped exacerbate the instability of the Naira by allowing people to move their funds into crypto.
Why Nigeria wants Binance users’ data
The order was granted as part of the Nigerian government’s extensive investigation efforts into Binance’s operation in the country.
Authorities have accused the exchange of exacerbating the nation’s foreign exchange issues through rate manipulation for personal gain. Consequently, the exchange’s official website has been blocked, and two senior executives have been apprehended.
A court affidavit sworn to by an EFCC official reportedly stated:
“The [EFCC] team uncovered users who have been using the platform for price discovery, confirmation, and market manipulation, which has caused tremendous distortions in the market, resulting in the Naira losing its value against other currencies.”
In addition, the affidavit revealed that Binance’s total trading volume from Nigeria last year stood at $21.6 billion.
Due to this, the Nigerian authorities requested the Federal High Court to compel Binance to disclose user data for investigative purposes.
Will Binance yield?
A look at Binance’s privacy terms shows that the exchange reserves the right to share user data with authorities for legal and regulatory compliance.
According to the terms:
“To comply with other legal and regulatory obligations. We may access, read, preserve, and disclose information when we believe it is reasonably necessary to comply with law, legal obligations, regulations, law enforcement, government, and other legal requests, court orders, or disclosure to tax authorities.”
However, whether the exchange will comply with the Nigerian authorities’ demands is unclear. As of press time, Binance has yet to respond to CryptoSlate’s request for additional comment.
Earlier today, Binance, the largest crypto exchange by trading volume, revealed that the assets held by its users on its platform exceeded $100 billion for the first time.
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Oluwapelumi Adejumo
Oluwapelumi values Bitcoin's potential. He imparts insights on a range of topics like DeFi, hacks, mining and culture, underlining transformative power.
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Binance is a global cryptocurrency exchange that provides a platform for trading more than 100 cryptocurrencies.
Richard Teng, a veteran in the financial services and regulatory sectors, boasts over three decades of extensive experience.