The Nigerian House of Representatives, in the National Assembly, Abuja, has initiated an investigation into the security implications of transactions involving cryptocurrencies and other digital assets in the country’s financial ecosystem.
This move comes in light of alleged connections between the foreign exchange market, virtual assets transactions, and recent security challenges.
The Lower Legislative Chamber will also examine the current status of the e-Naira, the Central Bank Digital Currency, on the global cryptocurrency platform. The investigation will delve into the costs, processes, and statutory compliance involved in creating the digital currency.
On Tuesday, March 5, 2024, Hon. Isiaka Ibrahim, a Federal legislator from Ogun State, read the resolution of the House, which mandates the House Committee on National Security and Intelligence to investigate the connection between gateway platforms and the security challenges facing the country.
The House of Representatives Committee on Financial Crimes had previously resolved to issue a warrant of arrest against the executives of Finance, a leading cryptocurrency platform, for their failure to appear before the committee for an investigation.
The Central Bank of Nigeria (CBN) recently alleged that approximately $26 billion had passed through Binance Nigeria’s platform in the past year. Ginger Onwusibe, Chairman of the Committee, stated that the warrant of arrest would compel Binance executives to appear before the lawmakers to address allegations of sponsoring terrorism and engaging in financial crimes in Nigeria.
Although a lawyer representing Binance appeared before the committee and presented a written address, the lawmakers rejected the explanation. It was reported that the Board of Directors of Binance expressed fear of coming to Nigeria due to potential further arrests by the Federal Government.
Previously, security agencies, in collaboration with the Office of the National Security Adviser (ONSA), apprehended two Binance executives in Nigeria. Additionally, the government is demanding approximately $10 billion in compensation from the cryptocurrency firm on allegations of manipulating foreign exchange exchange rates, which have negatively impacted the value of the Naira, the country’s currency.