A Warning For Nigerian Investors: SEC Warns Against Binance

SEC Warns Nigerian Investors: Beware Of Binance Fraud

Nigerian Securities and Exchange Commission (SEC) has issued a warning to all local investors not to refrain from using Binance, one of the biggest cryptocurrency exchanges in the world. This is specifically in reference to a previous warning pertaining to a fraud company that has been using the name of ‘Binance’ illegally. 

A statement has been released by SEC on July 28 in order to caution the Binance investors. Furthermore, the government is of the opinion that the platform does not have a valid license to operate in the country. Therefore, their existence and operation in the nation is in violation of the law. With this, the high level of risk and probable total loss of assets is also brought to the public's attention. The government further notified that:

"Any member investing with the company (Binance), or making such solicitation, is doing so at his/her own risk." 

This is the third time when the Nigerian authority issued such a notice. Prior to this, the authority has already issued a warning to the fraud company. The SEC stated that it learned about Binance Nigeria Limited at the start of June month. Therefore, they have ordered the company to "immediately stop providing fake services to the Nigerian investors in any form whatsoever."

Nigeria’s Stance of Crypto Currency Industry

Despite vigorously pushing its central bank digital currency (CBDC), Nigeria is always cautious about the cryptocurrency business. However, after eNaira has been introduced in 2021, acceptance rates have fallen short of projections, leading the central bank to consider a number of strategies to promote usage. In order to improve contactless payments, it enhanced the CBDC system with near-field communication technology in July.

The nation started taxing earnings on the sale of digital assets, including cryptocurrencies, in May 2023 at a rate of 10%. Stakeholders in the area called the measure "premature."

Binance Withdrawal from many Countries

Due to registration issues, Binance has also left a number of European nations. In order to regulate cryptocurrency, Europe was the nation that enacted the Markets in Crypto Assets Act (MiCA).

Furthermore, Binance also withdrew its application to operate in Germany last week. This is because the regulatory body for BaFin Germany rejected granting a license last month. This was not the end as Binance also disclosed its intentions to leave the Netherlands and Cyprus in June.

However, there’s also good news coming in the way of Binance. The company mentioned that it was getting closer to getting full clearance from Dubai's regulatory body. Binance received a minimal viable product license from the Virtual Asset Regulatory Authority on Monday, which means that in order to offer more permitted services, it simply has to get a complete market product license.

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