Binance, the world’s largest cryptocurrency exchange company, on Monday announced it has started accepting Naira deposits and withdrawals to ease traders’ and investors’ stress.
In February 2021, Binance halted Nigerian Naira deposits and withdrawals after the Central Bank of Nigeria (CBN) banned banks from facilitating payments for cryptocurrency platforms operating in the country.
The directive was necessary to curb capital outflow from the nation’s real economy into the cryptocurrency space during the peak of the bullish run that saw Shiba coin gaining over 30,000%, Bitcoin hitting $66,000 a coin and Dogecoin rising as high as $0.7 a coin within 12 months.
Binance introduced the peer-to-peer trading concept to ensure Nigerian customers can still deposit and withdraw despite the absence of deposit money banks.
In 2022, the apex bank accused Binance traders of being responsible for the Nigerian Naira’s high parallel market exchange rate against the United States Dollar. This, they did by setting the Naira exchange rate to a USDT, a U.S. Dollar backed stablecoin, at an assumed rate decided based on demand and supply on the Binance platform.
On Monday, November 7, 2022, Binance announced in a statement accessed by Investors King that Nigerian traders can now deposit and withdraw in local currency.
“Binance is pleased to announce that it has added a fiat gateway for Nigerian Naira (NGN) as part of Binance’s mission to increase the adoption and mainstream accessibility of crypto. Users are now able to deposit and withdraw NGN to and from their Binance wallets”, the statement reads.
The cryptocurrency exchange platform, however, advised all intending users to complete the Know Your Customer (KYC) requirement before they can deposit and withdraw in Naira on the platform.
Given the timing of the announcement, a period when the Nigerian Naira is trading at a record low against global counterparts, it is safe to say that the CBN had secretly lifted the ban imposed on Nigerian banks from facilitating cryptocurrency payments to encourage Naira to Naira trading against the pervasive Naira to USDT trading that most people are now using as a Naira-US Dollar exchange rate determinant.
The idea is to ease the current exchange rate.
FG to Start Imposing Tax on Crypto Traders By 2023
The Federal Government through the Minister of Finance, Budget and National Planning, Zainab Ahmed has said there is a provision to start imposing taxes on cryptocurrency and other digital assets investing in the 2022 finance bill.
A statement signed late Thursday by the Senior Special Assistant to the Vice President on Media and Publicity, Laolu Akande noted that the finance bill was discussed at an extraordinary virtual meeting of the National Economic Council presided over by Vice President Yemi Osinbajo.
The meeting also deliberated on other prevailing issues which include Taxation, Revenue Generation, Climate Change and the Green Growth pillar of the bill.
If passed into law, this will avail the government an opportunity to start generating revenue from growing cryptocurrency investment in Nigeria.
Investor King learnt that the federal government is already talking to Investors in Europe, US and Canada to invest in Nigeria’s gas sub-sector.
According to the statement, the meeting agreed that there should be incentives for the natural gas sector and discouragement of gas flaring.
“Under the climate change and green growth bill, there will be incentives for natural gas” the statement partly read.
With respect to cryptocurrency, the bill these clarify the basis for the taxation of Cryptocurrency and other Digital Assets in line with the Government’s policy thrust of enhancing the cross-border and international taxation of growing e-commerce with emerging markets.
It could be recalled that the CBN in 2021 directed that all commercial banks should close accounts of persons or entities involved in cryptocurrency transactions.
However, it seems the government is taking a soft position on cryptocurrency in recent times particularly as the largest crypto exchange in the world, Binance now accept naira deposit and withdrawal.
Meanwhile, Investors King understands that if the bill is passed into law, Nigeria will join other countries which include the Kingdom, the United States of America, Australia, India, Kenya and South Africa that are currently taxing cryptocurrency.
Speaking further on the finance bill 2022, the Minister of Finance noted that the proposed bill is anchored on five fundamental policy drivers which are tax equity, climate change, job creation and economic growth, tax incentive reform and revenue generation.
FTX Missing Billions Remain Mystery After Bankman-Fried Grilling
The mystery continues to shroud the missing billions at bankrupt crypto exchange FTX after its disgraced founder Sam Bankman-Fried denied trying to perpetrate a fraud while admitting to grievous managerial errors.
In his first major public appearance following the Nov. 11 implosion of FTX and sister trading house Alameda Research, Bankman-Fried said he “screwed up” at the helm of the exchange and should have focused more on risk management, customer protection and links between FTX and Alameda.
“I made a lot of mistakes,” the 30-year-old said Wednesday by video link at the New York Times DealBook Summit. “There are things I would give anything to be able to do over again. I didn’t ever try to commit fraud on anyone.”
Bankman-Fried’s participation was controversial given there are outstanding questions about how Bahamas-based FTX ended up with an $8 billion hole in its balance sheet and whether it mishandled customer funds. Reports that FTX lent client money to Alameda for risky trades have stoked such concerns.
Interviewed by New York Times columnist Andrew Ross Sorkin, who said Bankman-Fried was joining from the Bahamas, the fallen crypto mogul didn’t give a straight answer about whether he had at times lied.
Bankman-Fried told the summit that he “didn’t knowingly commingle funds.” At the same time, he said that FTX and Alameda were “substantially more” linked than intended and that he failed to pay attention to the trading house’s “too large” margin position.
He said he wasn’t running Alameda and added that he was “nervous about a conflict of interest.” No person was in charge of position risk at FTX, he said, describing the lack of oversight as a mistake.
Out of Control
The comments shed little light on the question of where client funds ended up as Bankman-Fried stuck to a hard-to-parse account of how Alameda ran up a massive margin position on the exchange.
The restructuring expert who took over the firm in bankruptcy, John J. Ray III, has painted a picture of FTX as a mismanaged, largely out-of-control company bathed in conflicts and lacking basic accounting practices, calling it the worst failure of corporate controls he’d ever seen.
Bankman-Fried faces a complex web of lawsuits and regulatory probes into alleged wrongdoing. Some observers speculate his public comments could be used against him in litigation.
The spotlight has also fallen on an apparent company culture of working and playing hard. Bankman-Fried said there were no wild parties and that he saw no illegal drug use. He added that he’s been prescribed drugs over time to help with focus and concentration.
The digital-asset sector is braced for widening contagion from FTX, which once boasted a $32 billion valuation before sliding into bankruptcy. It owes its 50 biggest unsecured creditors a total of $3.1 billion and there may be more than a million creditors globally.
A crypto lender, BlockFi Inc., filed for bankruptcy Monday after being buffeted by the wipeout. Embattled brokerage Genesis is striving to avoid the same fate.
BlackRock Inc. Chief Executive Larry Fink said earlier at the DealBook summit that most crypto companies will probably fold in the wake of FTX’s collapse. The world’s biggest asset manager was among firms stung by the chaotic unraveling of Bankman-Fried’s tangled web of 100-plus FTX-related entities.
Bankman-Fried has provided convoluted accounts on social media and in interviews with other news outlets about what led to FTX’s woes. Advisers overseeing the ruins of his business have slammed non-existent oversight.
As if such travails weren’t enough, the exact breakup of a $662 million outflow from FTX as it tumbled into bankruptcy remains another enigma. Bankman-Fried said in the summit interview that there was improper access to FTX after its spiral.
Treasury Secretary Janet Yellen, another speaker at the summit in New York, called the FTX debacle “the Lehman moment within crypto,” referring to the collapse of investment-banking giant Lehman Brothers in 2008.
Crypto markets have stabilized somewhat after lurching lower in November as the turmoil around FTX thickened. Even so, a gauge of the top 100 tokens is down more than 60% this year, hit by tightening monetary policy and a series of crypto blowups of which FTX is the most spectacular.
Bankman-Fried’s fortune at one point reached $26 billion, and just weeks ago he was described as the John Pierpont Morgan of digital assets, willing to throw around his wealth to bail out the industry. He said during the interview that he’s down to one credit card and $100,000 in the bank.
Pressed on whether he had been straight about FTX, Bankman-Fried said: “I was as truthful as I’m knowledgeable to be.”
Binance CEO, Zhao to Create $1bn for Purchase of Distressed Assets
According to an interview with Chief Executive Officer Changpeng Zhao, cryptocurrency exchange Binance wants to create a fund of about $1 billion for the potential purchase of distressed digital assets.
In an interview with Bloomberg, Zhao made a suggestion about possible funding increases. He said, “If that’s not enough, we can allocate more.”
The recovery fund Zhao’s business plans to set up to help cryptocurrency projects experiencing a liquidity crisis as a result of the failure of rival FTX has drawn a lot of interest from industry players, Zhao said last week while addressing a conference in Abu Dhabi.
Zhao stated he doesn’t have a precise number in mind for the size of the recovery fund while speaking at a conference in Abu Dhabi.
He declined to name other exchanges or institutions at this time, but said that there were “players that have strong financials and we should band together; we’ve got significant interest so far.”
Zhao stated that Binance has strong reserves, but he did not specify how much the business would contribute to the fund.
Zhao remarked that Crypto didn’t require saving. “Crypto will be fine.”
Zhao stated that more information about the fund will be made available over the following two weeks.
Investors King learned that earlier today, Binance’s Twitter account posted information about the launch of a new project and token sale by Binance Launchpad. Similarly to this, Binance has released information about the upcoming token sale for HOOK, the Hooked Protocol’s native cryptocurrency.
In the same manner, as with earlier projects that Binance has launched on its platform, the token sale will be conducted as a lottery. Participants’ BNB balances will be recorded starting at 0:00 UTC today and continuing until 0:00 UTC on December 1.
Snapshots of balances will be made on an hourly basis during that period of seven days.
The self-custody wallet NGRAVE has received a strategic investment from Binance, and the company will manage its Series A round. The largest exchange by volume has decided to capitalize on the growing demand for hardware wallets. After the recent failure of the important cryptocurrency exchange FTX, a rise has been noted.
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