One of the largest cryptocurrency exchanges by volume, Binance, has removed naira from its trading pairs after the Central Bank of Nigeria asked banks and other financial institutions to close the accounts used for cryptocurrency operations.
Binance made this known in a statement sent to traders and made available on its website on Monday titled, ‘Notice of removal of trading pairs’.
It noted that the removal takes effect from Tuesday, February 8, 2021.
The exchanges urged users to transfer their peer-to-peer wallet for transactions.
The statement read, “Binance will remove and cease trading on the following trading pairs at 2021-02-09 12:00 PM (UTC): BNB/NGN, BUSD/NGN, DOT/NGN, ETH/NGN, LINK/NGN, LTC/NGN, TRX/NGN, XRP/NGN.
“Please note: NGN is fiat currency and does not represent any other digital currencies.
“Users can transfer their fiat or crypto balance to their P2P wallet, and buy or sell cryptocurrency with NGN at zero fees on the Binance P2P platform.
“Users can still trade the above assets in other trading pairs that are available on Binance.
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“Risk warning – Cryptocurrency trading is subject to high market risk. Please make your trades cautiously.
“Binance will make best efforts to choose high-quality coins, but will not be responsible for your trading losses.”
…Binance suspends deposits in Nigeria indefinitely
Earlier, Binance temporarily suspended deposits in Nigerian naira after CBN directed local banks to identify and close all accounts tied to cryptocurrency platforms or operations.
In a statement, Binance said, “We are aware of the recent circular shared by the Central Bank of Nigeria (CBN) around cryptocurrency-related Nigerian naira (NGN) payment activities in Nigeria and we are monitoring the situation closely.
“Please note all your funds on Binance.com remain safe and crypto services on Binance.com will continue as normal.
“However, our NGN payment partners are suspending deposit services until further notice. From 7PM (GMT+1) on February 5, 2021, Binance will temporarily suspend NGN deposits through our fiat partner channels. Withdrawal services remain normal and will continue to be processed but might take slightly longer time than usual.”
Withdraw your naira
The founder and CEO of cryptocurrency exchange, Binance, Changpeng Zhao has reacted to the order by the Central Bank of Nigeria which prohibits commercial banks and all non-banking financial institutions from transactions involving cryptocurrencies.
Reacting to the order which, according to Zhao, will affect naira deposits and withdrawals, the Binance CEO advised the withdrawal of naira to avoid potential channel issues.
“Received notice from our channel partners that NGN deposits and withdrawals will be affected,” the CEO wrote on his official Twitter handle on Friday.
“Still confirming details on when/how. Please withdraw your NGN as early as possible to avoid potential channel issues. Will share more details as they become available.”
In another tweet, he said, “To err on the safe side, we have also disabled deposits to prevent more NGN coming in.”
Why we banned cryptocurrency account -CBN
The Central Bank of Nigeria has said cryptocurrencies promote illegal activities and raise risks, among other reasons.
It said this on Sunday in a statement regarding various comments and reactions following its recent reminder to Deposit Money Banks to desist from transacting in/and with entities dealing in cryptocurrencies.
The CBN stated, “The recent regulatory directive became necessary to protect the financial system and the generality of Nigerians (including the youth population) from the risks inherent in crypto assets transactions, which have escalated in recent times, with dire consequences for the integrity of the financial system and financial stability.
“Due to the fact that cryptocurrencies are largely speculative, anonymous and untraceable they are increasingly being used for money laundering, terrorism financing and other criminal activities.
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“Small retail and unsophisticated investors also face high probability of loss due to the high volatility of the investments in recent times.
“In light of these realities and analyses, the CBN has no comfort in cryptocurrencies at this time and will continue to do all within its regulatory powers to educate Nigerians to desist from its use and protect our financial system from activities of fraudsters and speculators.”
The CBN said for those who were not conversant with the universe of cryptocurrencies, it was important to state that cryptocurrencies “are digital or virtual currencies issued by largely anonymous entities and secured by cryptography.”
It stated, “Cryptography is a method of encrypting and hiding codes that prevent oversight, accountability, and regulation.
“While there are a number of cryptocurrencies now in circulation, Bitcoin was the first to be introduced in 2009, and now accounts for about 68 percent of all cryptocurrencies.
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“As regards our recent policy pronouncement, it is important to clarify that the CBN circular of February 5, 2021 did not place any new restrictions on cryptocurrencies, given that all banks in the country had earlier been forbidden, through CBN’s circular dated January 12, 2017, not to use, hold, trade and/or transact in cryptocurrencies.
“Indeed, this position was reiterated in another CBN press release dated February 27, 2018.”
The CBN said its position on cryptocurrencies was not an outlier as many countries, central banks, international financial institutions, and distinguished investors and economists had also warned against its use.
It stated that they had all made similar pronouncements based on the significant risks that transacting in cryptocurrencies portend which include risk of loss of investments, money laundering, terrorism financing, illicit fund flows, and criminal activities.
It stated that China, Canada, Taiwan, Indonesia, Algeria, Egypt, Morocco, Bolivia, Kyrgyzstan, Ecuador, Saudi Arabia, Jordan, Iran, Bangladesh, Nepal, and Cambodia had all placed a certain level of restrictions on financial institutions facilitating cryptocurrency transactions.