The Central Bank of Nigeria (CBN) has accused cryptocurrency exchange Binance of operating without proper authorization, leading to charges of money laundering against the company and its executive, Tigran Gambaryan. This was revealed during a trial in Abuja, where Nigerian prosecutors presented evidence against Binance.
Olubukola Akinwunmi, head of payment policy and regulation at the CBN, testified that Binance had no license to facilitate cryptocurrency trades for Nigerians. “The Central Bank of Nigeria did not issue any license to Binance,” Akinwunmi said in response to questions from lawyers for the Economic and Financial Crimes Commission (EFCC).
According to local reports, Akinwunmi explained that Binance’s platform allowed users to conduct deposit and withdrawal transactions typically reserved for authorized banks and financial institutions. He highlighted that Binance’s peer-to-peer (P2P) platform facilitated the transfer of the Nigerian fiat currency, Naira, using either bank accounts stored on the Binance platform or Naira wallets provided by Binance.
Akinwunmi elaborated, “So the Binance platform facilitates all the processes of P2P transactions as I have just enumerated, either using a Nigerian bank account already stored by users on the Binance platform or the naira wallet account provided by the Binance platform.” He emphasized that these transactions violated CBN rules.
The EFCC’s case against Binance and Gambaryan focuses on alleged money laundering involving $35.4 million. Akinwunmi testified that Binance enabled Nigerian users to conduct transactions using pseudonyms, which goes against the CBN’s requirement for parties to disclose their true identities in financial transactions. He also accused Binance of facilitating currency conversion from Naira to U.S. dollars, which requires CBN authorization as an authorized dealer or a Bureau de Change.
This crackdown on Binance follows the National Security Adviser’s classification of cryptocurrency trading as a national security threat. In February, Nigerian authorities detained two senior Binance executives, Anjarwalla and Gambaryan. Amid the scrutiny, Binance disabled its P2P feature for Nigerian users.
In response to these developments, the CBN has directed fintech startups such as Opay, Moniepoint, Paga, and Palmpay to block and report accounts engaged in cryptocurrency transactions. Additionally, Nigeria’s Securities and Exchange Commission (SEC) has issued a 30-day window for crypto exchanges and digital asset traders to re-register their businesses under a new regulatory regime, warning of enforcement actions for non-compliance.
The trial is set to continue on July 16, with the defense’s cross-examination of Akinwunmi. Judge Emeka Nwite of the Federal High Court of Nigeria in Abuja has also ordered the Nigerian Correctional Services to produce Gambaryan’s medical reports, warning of consequences for non-compliance.
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