SEC Warns Nigerians: Trading on Binance is Illegal
• The Nigerian Securities and Exchange Commission (SEC) has warned local investors against using the crypto exchange Binance, as they do not have a license to operate in the country.
• The SEC issued a warning about the high risk of investing with Binance and potential total loss of investments.
• In May 2021, Nigeria introduced a 10% tax on gains from the disposal of digital assets including cryptocurrencies.
Nigeria’s SEC Warns Against Trading on Binance
The Nigerian Securities and Exchange Commission (SEC) has warned local investors against using one of the world’s largest crypto exchanges, Binance. The agency insists that the platform doesn’t have a license to work in the country and that its operation is illegal. It also reminds the public about the high level of risk and potential total loss of investments.
Previous Circular Issued Against Fraudulent Company
In June, the SEC published a circular limiting the activities of Binance Nigeria. The circular represented a warning for investors and platforms as it is now being repeated again by the SEC. However, it should be noted that Binance Nigeria was a fraudulent entity without any affiliation with Binance itself. In response to this, Binance issued a cease and desist notice to Binance Nigeria.
Central Bank Digital Currency Failing To Gain Traction
Despite strongly promoting its central bank digital currency (CBDC), Nigeria maintains a cautious stance on cryptocurrency industry adoption rates remain low prompting them to explore ways to drive usage such as introducing near-field communication technology for contactless payments in July 2021.
Tax On Gains From Digital Assets
In May 2021, Nigeria introduced a 10% tax on gains from disposing digital assets such as cryptocurrencies which some stakeholders called “premature” due to their negative effect on adoption rates within blockchain projects.
Cease And Desist Notice To Unregistered Platforms
Lastly,the SEC demands unregistered platforms like Binance immediately stop services in order to comply with domestic law regulations in Nigeria or face further consequences if they continue operating without authorization or proper licensing within their jurisdiction .