Nigeria’s recent legal move against Binance has captured global attention. The Federal Government has filed a lawsuit seeking a staggering $81.5 billion in economic losses and back taxes from the crypto exchange.
This unprecedented action reflects a determined stance on crypto regulation and sends mixed signals to investors and the international business community.
The arrest and prolonged detention of Binance executive Tigran Gambaryan in Nigeria, followed by the botched prosecution and his subsequent allegations of bribery demands during a meeting on Saturday, January 4, 2024, by three members of the House of Representatives, namely, Peter Akpanke, Philip Agbese, Ginger Onwusibe and the National Security Adviser, Nuhu Ribadu, cast a shadow over Nigeria’s justice system and business environment.
Gambaryan, detained for eight months on money laundering charges that were eventually dropped, accused top officials of soliciting a $150 million bribe to prevent his arrest and prosecution.
Mr Tigran Gambaryan in a post on his X (formerly Twitter) handle on Friday, February 14, revealed,“At the House meeting, there were three members present. Two of them were Peter Akpanke and Philip Agbese, both working under the leadership of Ginger Obinna Onwusibe.
“There was a third House member, but I don’t recall his name. They set up fake cameras and media to make the meeting appear official, but the cameras weren’t even plugged in.
“As you may already know, this ended with them asking for a $150 million bribe, paid in cryptocurrency into their personal wallets. A Mickey Mouse operation at its best.”
In response to the allegations, Mr Philip Agbese denied Gambaryan’s claims stating,“I am outraged by the false allegations made by Tigran Gambaryan, an executive of the controversial crypto firm Binance, claiming that I was among those who demanded a $150m bribe from him.
“These allegations are false. I was not part of any meeting with any Binance executive regarding money for any purpose. The leadership of the committee took the matter to court, and Binance has already apologised.”
Agbese, who doubles as the deputy spokesman for the lower House, urged the Binance boss to support his claims with evidence or face the consequences.
Also, Mr Ginger Onwusibe in his rebuttal denied the allegations stating that the meeting between Mr Tigran Gambaryan and the mentioned Reps members was professional, transparent, and ended on a cordial note, with no demands for bribes. and said the matter was before the court.
Recall that, On September 18, 2024, Onwusibe filed a lawsuit against Binance and Teng at the High Court of the Federal Capital Territory, seeking an apology, a retraction, and $3bn in damages.
National Security Adviser, Nuhu Ribadu has not publicly responded to Gambaryan’s allegations.
Meanwhile, the FG also weighed in, rejecting Gambaryan’s allegations in a statement by the Minister of Information and National Orientation, Mohammed Idris.
The statement read in part, “we categorically deny the retaliatory claims made by Mr. Gambaryan against Nigerian officials involved in his case, and we urge the public to disregard these false accusations in their entirety.”
These events suggest potential systemic issues within Nigeria’s legal processes and raise concerns about the fairness and transparency of its judicial system.
Such incidents can deter foreign investors, who may perceive the business climate as unpredictable and fraught with legal uncertainties, thereby hindering Nigeria’s efforts to attract much-needed foreign direct investment.
At the heart of this legal battle is a concern over the Naira. The Federal Government claim that Binance’s operations have contributed to currency instability and the loss of economic value by allowing massive amounts of money to leave the country unchecked, as well as unpaid taxes.
This move by the FG is part of a broader regulatory trend seen around the world as governments try to balance the benefits of fintech innovation with the need for financial stability and tax revenue.
For Nigeria, a country with a young, tech-savvy population and a rapidly growing digital economy, cryptocurrency offers enormous potential.
However, regulators are increasingly wary of the risks that come with unregulated digital financial flows. By taking on Binance, Nigeria is clearly positioning itself as a country that prioritises domestic financial health over short-term gains from digital innovation.
However, such an aggressive regulatory approach comes with risks. Investor confidence may be shaken by the perception of an unpredictable legal environment.
International investors often seek stability and clear, consistent regulations before committing capital. An action as dramatic as suing a global giant like Binance could be interpreted in two ways.
On one hand, it may reassure investors that Nigeria is serious about enforcing its laws and protecting its economic interests. On the other hand, the sheer size of the claim, $81.5 billion, is likely to raise concerns about regulatory overreach.
Recall that the largest fine Binance has ever been slammed with is a $4.3 billion claim by the U.S Department of Justice to settle anti-money laundering and sanctions violations and is one of the largest corporate penalties in U.S. history
Investors might fear that the FG could pursue similar aggressive tactics in other sectors, thereby increasing the perceived risk of doing business in the country.
For foreign direct investment (FDI), Nigeria’s regulatory environment is a key factor. While the country has long sought to attract more FDI to boost its economy, actions that appear heavy-handed or unpredictable could be a deterrent.
Investors might wonder if a future government would continue on a path of strict regulatory interventions, potentially impacting the profits and operations of international companies.
Thus, Nigeria’s fight against Binance is not only a dispute with one company, it is a signal to all foreign investors about the country’s approach to economic governance and regulation.
READ ALSO: FG Slams Binance With Fresh $81.5bn Lawsuit
At the same time, Nigeria’s bold move may also be seen as a necessary correction. The global crypto market has sometimes operated in a regulatory grey zone, allowing companies to skirt around local laws and undermine national economic policies.
By firmly stepping in, Nigeria is asserting its right to control the economic activity within its borders and to protect its currency and tax base.
This could, in the long run, build a more robust regulatory framework that might attract investors who appreciate transparency and accountability.
Ultimately, Nigeria’s lawsuit against Binance is a double-edged sword. It sends a powerful message that the country is not a playground for unchecked digital finance—it is a nation that demands accountability.
Yet, it also risks creating an atmosphere of uncertainty among investors, who might worry about similar interventions in the future. Whether this move will strengthen Nigeria’s economy and attract sustainable FDI or push investors away remains to be seen.