• Nigeria’s SEC orders Binance Nigeria Limited to stop operations due to lack of registration and regulation.
• The order follows the US SEC lawsuit against Binance and its founder CZ.
• Nigeria’s SEC had previously said all crypto assets are securities by default.
Nigeria’s SEC Orders Binance Nigeria Limited To Stop Operations
Nigeria’s Securities and Exchange Commission (SEC) has issued a circular ordering Binance Nigeria Limited to immediately cease all operations in the country. The SEC stated that the exchange was operating illegally as it was neither registered with nor subject to regulations from the agency. The order comes days after the US Securities and Exchange Commission (SEC) sued Binance, its US affiliate, and its founder Changpeng Zhao for violating securities laws in the country.
Reason For The Order
The circular from Nigeria’s SEC stated that any individual who is dealing with Binance Nigeria Limited is doing so at his/her own risk as it is neither registered nor regulated by the Commission. It further warned Nigerians about investing in crypto-assets or related financial products and services if their service provider/platform is not registered or regulated by Nigerian authorities, citing that such activities may result in a total loss of investment capital.
US Lawsuit Against Binance
Prior to this action taken by Nigerian authorities, on Monday, June 7th 2021, the US Securities and Exchange Commission (SEC) announced it had filed a lawsuit against Binance, its US affiliate, and its founder Changpeng Zhao for violating securities laws in the country. In addition, it has requested for assets of Binance.US to be frozen pending further proceedings against them.
Previous Stance On Cryptocurrencies
This marks the first time Nigeria’s SEC has taken legal action against an unlicensed cryptocurrency platform operating within its borders; however, they have previously stated that all crypto assets should be treated as securities by default under Nigerian laws.
In conclusion, this move serves to caution investors on engaging with unregistered operators when conducting cryptocurrency transactions or investing in digital asset related products services within Nigerian jurisdiction; thus serving as a reminder for individuals seeking to invest in cryptocurrencies to adhere strictly to local regulatory guidelines set out by their respective governments before making any decisions regarding investments into digital currencies or related financial services providers