Binance Nigeria Scam: We’ll seek clarity, cooperate with SEC on next moves -Zhao, Binance CEO

*Binance, the world’s biggest cryptocurrency exchange, declares the Nigerian company is ‘scam entity’, after the country’s Securities and Exchange Commission had earlier directed it to stop operations in the West African country, stating it is neither registered nor regulated

Isola Moses | ConsumerConnect

Following recent regulatory disapproval of the entity in the West African country, Binance, the world’s biggest cryptocurrency exchange, has issued a cease-and-desist notice to a company called “Binance Nigeria Limited”.

ConsumerConnect learnt Changpeng Zhao, Chief Executive of the company, Sunday, June 18, 2023, in a message on Twitter described ‘Binance Nigeria’ as a “scammer entity”.

Zhao said the Nigerian entity is not affiliated with Binance.

The declaration came after the Nigerian Securities and Exchange (SEC), a financial regulator, last week ordered Binance to halt its operations in the country.

SEC stated that “Binance Nigeria Limited” was not registered or regulated, thereby making it illegal to operate in the country.

The statement also said: “Binance Nigeria Limited is hereby directed to immediately stop soliciting Nigerian investors in any form whatsoever.”

Cryptocurrency crackdown on Binance, Coinbase

Zhao said the firm would seek clarity from the SEC and cooperate with it on the next steps, Silicon UK report said.

His company, the world’s biggest cryptocurrency exchange, recently announced plans to leave The Netherlands, Cyprus, Canada and Australia, and faces regulatory action from multiple US regulatory agencies.

Besides, the US earlier June had charged Binance and Zhao with artificially inflating trading volumes, diverting customer funds, and misleading investors about market control.

However, Binance has disputed the charges, according to report.

The SEC also sued Coinbase, the largest crypto exchange in the US by trading volume.

The American country’s financial regulator said the company was operating its platform as an unregistered securities exchange, broker and clearing agency in the economy.

Lawsuits

The regulator also disclosed that Coinbase had since at least 2019 made billions of Dollars by facilitating crypto exchanges while evading disclosure requirements meant to protect investors.

Coinbase general counsel Paul Grewal said the company would continue operating as usual and that it had “demonstrated commitment to compliance”.

Binance, SEC agree to retain consumers’ assets in US

Meanwhile, both Binance and the US Securities and Exchange Commission have reached an agreement to avoid a full asset freeze of the platform in the US and keep customer assets in the United States, after a US district judge signed off on a consent order filed at the weekend.

They reached the agreement amid a wide-ranging, ongoing lawsuit filed by the SEC, which could take months if not years to resolve, accusing the company of running an illegal securities exchange in the country.

The defendants, including CEO Changpeng Zhao, agreed to repatriate assets held for the benefit of US consumers.

The agreement makes sure those assets are protected and remain in the United States to prevent them from moving offshore, according to the consent order, report said.

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