KuCoin has decided to temporarily suspend all naira-based peer-to-peer (P2P) trading in response to increased scrutiny from Nigeria’s regulatory authorities. This move follows a meeting between the country’s Securities and Exchange Commission (SEC) and industry players, where the SEC urged a halt to P2P trading activities. In a blog post, KuCoin informed users of the suspension of P2P naira services and Fast Buy service via Naira card as part of ongoing efforts to enhance their services. This decision is likely an attempt to avoid regulatory issues in Nigeria, especially given the recent federal charges faced by another major exchange, Binance.
Nigeria has intensified its scrutiny of P2P cryptocurrency trading, with instructions for fintechs and banks to close accounts associated with trading and report them to authorities. The Economic and Financial Crimes Commission (EFCC) has taken action by blocking thousands of accounts involved in crypto trading. Emomotimi Agama, the Director-General of the SEC, blamed crypto P2P traders for the depreciation of the naira during a meeting in May. Despite these measures, the naira continues to face challenges, with a recent decline against the Dollar at the FOREX parallel market.
Binance, another major exchange, has faced conflict with Nigerian regulatory authorities. Binance CEO Richard Teng accused a Nigerian government official of pressuring crypto representatives to accept a secret agreement involving a $150 million bribe. The exchange had to discontinue all services involving the Nigerian naira (NGN) following regulatory scrutiny and is accused of using the bribe accusation as a distraction from its actions. The Nigerian government previously imposed a $10 billion fine on Binance as part of a crackdown on the platform to stabilize the country’s local currency. Binance has also faced regulatory scrutiny in other countries, including charges from the CFTC and the SEC for allegedly operating illegal exchanges and evading federal laws.
The temporary suspension of P2P naira services by KuCoin and the conflicts faced by Binance highlight the complexities of operating in the cryptocurrency space under increasing regulatory scrutiny. Both exchanges are dealing with regulatory restrictions and challenges in Nigeria, with a focus on P2P trading activities. The actions taken by the Nigerian government, including blocking accounts and imposing fines, demonstrate the efforts to regulate and stabilize the local currency. These developments underscore the importance of compliance and regulatory oversight in the cryptocurrency industry, as exchanges navigate the evolving landscape and address regulatory concerns to continue operating effectively. KuCoin and Binance are both facing challenges in Nigeria and globally, reflecting the broader regulatory environment impacting the cryptocurrency market.
