Experts and crypto enthusiasts have lamented the current ban on Binance naira operations in Nigeria, stating it may increase youth unemployment in the country.
In separate interviews with The PUNCH, the experts called on the government to look for better means of managing the country’s current foreign exchange challenges.
An economist with Lotus Beta Analytics, Shedrach Israel, said that the recent move by the government was tantamount to “treating malaria with paracetamol”.
He claimed the ban on Binance would not address the falling value of the naira.
“I don’t know why the cryptocurrency is being seen as sabotage on the exchange rate because the cryptocurrency is not the major means by which the dollar is flowing in Nigeria. Banning Binance is like giving a malaria patient paracetamol. Although paracetamol may cure the pain of malaria, it does not cure the sickness.
“Similarly, banning Binance has not stopped the naira from falling because the issue is bigger. Binance is just a bit of how much liquidity the dollar has in Nigeria,” he argued.
Israel has called on the CBN to investigate the forex holdings of top Nigerian politicians.
“These people, whether politicians or private citizens, who have stored up forex should be made to convert their money to naira, otherwise, the ban would not be effective.
“Although the CBN governor claimed about $26bn had left Nigeria through Binance unaccounted, the fact is that Binance uses peer-to-peer trade, which means that there is inflow and outflow of naira in the economy. If $26bn has gone out, how much has come in? Binance is not our problem. Some Bureau de Change operators are possibly richer than Binance users,” he added.
According to the National Bureau of Statistics unemployment data, the unemployment rate among youth aged (15-24 years) in Q2 2023 was 7.2 per cent, compared to 6.9 per cent in Q1 2023.
It is estimated that over 22 million people, or 10.3 per cent of Nigeria’s total population, currently own digital currency.
In September 2023, the Securities and Exchange Commission of Nigeria issued a definitive statement, explicitly clarifying that Binance Nigeria was neither registered nor regulated by the SEC.
This official declaration categorises the operations of the renowned global cryptocurrency exchange, within Nigeria as illegal and unauthorised.
In December 2023, the apex bank changed its stance on crypto assets in the country and asked banks to disregard its earlier ban on crypto transactions.
