In Nigeria’s Crypto community, Investors are cautious about the risks involved in investing in local Web3 companies, fearing potential consequences like those experienced by Binance, as stated by Uwakwe, the group’s leader. The impact of the repercussions faced by Binance executives is evident in Nigeria as investors are pulling out of various deals and collaborations, especially in the Web3 industry. The country is currently being criticized for its unsafe business environment and unfriendly government attitude.
It has been stated that the Binance incident is being used as proof for this attitude by the government of Nigeria as stated by Lucky Uwakwe, chair of the Blockchain Industry Coordinating Committee of Nigeria (BICCoN). During a discussion with Cointelegraph, Uwakwe, leader of the collaborative Blockchain Nigeria User Group (BNUG), Cryptography Development Initiative of Nigeria (CDIN), and Stakeholders in Blockchain Technology Association of Nigeria (SiBAN), brought to light and revealed the worries of investors.
Current investors are starting to slowly withdraw their investments.
Uwakwe expressed concerns about the future consequences that investors may face when putting their money into local Web3 companies, drawing parallels to what happened to Binance. He highlighted that current investors are starting to slowly withdraw their investments. During their visit to Nigeria in February, Binance executives Tigran Gambaryan and Nadeem Anjarwalla faced accusations of manipulating the country’s fiat currency, the naira. There was a meeting with the Nigerian government to address the regulatory issues of Binance.
At the meeting, the executives were unexpectedly detained and charged with five counts related to money laundering. Uwakwe expressed concerns about how the government is handling the Binance situation with the argument that their actions are having a negative impact on the nation as a whole. Instead of supporting and nurturing the industry, the decision of the Nigerian government to impose fines on Binance is hindering its growth and prioritizing short-term solutions over long-term development.
Binance executives’ chances of being acquitted are minimal.
More so, Uwakwe shared doubt when questioned about the likelihood of an acquittal for the Binance executives in the ongoing trial. He is of the opinion that the executives’ chances of being acquitted are minimal unless specific internal conditions are fulfilled by the company, as per the government’s view. It is likely that the odds stand at 90-10, with a 90% chance of favouring the government and a mere 10% chance for the Binance executives involved in the matter.
Furthermore, Uwakwe made it clear that even if the Binance executive is found not guilty by the judge, there is a high chance that the Nigerian government will ignore the court decision. This behaviour has been seen in similar situations in the past, particularly when the government feels its stability is at risk. Uwakwe responded to concerns from the global audience regarding the lack of strong advocacy from the Nigerian crypto community for the release of the Binance executives.
Related Article: Cryptocurrency Exchange Binance on Trial
Additionally, he proposed that if Binance had collaborated with pertinent groups sooner, they could have received backing from advocacy organizations and lobbying campaigns. There is a history of tension between the Nigerian government and cryptocurrency exchanges. Binance stopped using the Naira on March 8 following government scrutiny of crypto exchanges, particularly singling out the company in February. Nigeria’s fascination with Cryptocurrency reached new heights in August 2022 when it was ranked as the top country in the world based on Google search volume for terms like cryptocurrency and buy crypto.