The Nigerian government has filed a Lawsuit against Binance Holdings Limited, seeking $79.51 billion and ₦231 million in damages for alleged economic losses linked to the Cryptocurrency platform’s operations in the country. The Federal Inland Revenue Service (FIRS) also demands $2 billion in unpaid income taxes for 2022 and 2023. The case, filed at the Federal High Court in Abuja, accuses Binance and two of its executives, Tigran Gambaryan and Nadeem Anjarwalla, of failing to register for Tax compliance and violating various financial regulations. This marks the third lawsuit against the company in Nigeria, with previous charges including tax evasion, money laundering, and foreign exchange violations.
Court documents reveal that Binance allegedly concealed its business activities in Nigeria despite having a significant economic presence, as defined by the Significant Economic Presence (SEP) Order of 2020. The government contends that Binance generated substantial revenue from Nigerian users while bypassing tax obligations. An affidavit by Jimada Yusuf, a member of the National Security Adviser’s Special Investigation Team, indicates that the platform had 386,256 active Nigerian users in 2023, trading volumes of $21.6 billion, and a net revenue of $35.4 million. Despite a court order, Binance allegedly refused to provide business records spanning six years, raising concerns over transparency.
FIRS claims Binance unlawfully traded Naira on its platform.
Moreover, further allegations include engaging in currency speculation, offering unauthorised financial services, and operating without proper licenses, The FIRS claims that Binance unlawfully listed and traded the Nigerian Naira on its platform, contradicting its assertion that it had delisted the currency following regulatory scrutiny. The case was presented before Justice Inyang Ekwo on 11 February 2025, but Binance’s legal team was absent. The court subsequently granted a motion for substituted service, allowing alternative means of notifying the company. The case is set to resume on the 3rd of March 2025.
Apart from Taxation concerns, the Nigerian government appears to be taking a broader stance against cryptocurrency exchanges operating outside formal regulations. The rapid Devaluation of the naira in recent months has been partly blamed on speculative activities linked to platforms like Binance. Authorities have argued that unregulated Crypto transactions contribute to capital flight and foreign exchange volatility, exacerbating economic instability. This latest lawsuit signals the government’s determination to assert control over digital financial activities within the country.
Lawsuit may cause harm to Nigeria’s crypto market.
Furthermore, the outcome of this case could have far-reaching implications for cryptocurrency Regulation in Nigeria. If successful, the lawsuit may set a precedent for stricter enforcement against other digital asset platforms operating without formal compliance. It could also push Binance and similar companies to reconsider their approach to the Nigerian market, potentially leading to negotiations on regulatory frameworks. However, some analysts warn that aggressive crackdowns could stifle Innovation and drive crypto transactions further underground, complicating oversight efforts.
Amid these developments, industry observers highlight the need for a balanced regulatory approach that safeguards national economic interests while fostering technological innovation. Enforcing tax compliance and financial regulations is essential to maintaining Economic Stability and curbing illicit financial activities. However, overly stringent restrictions could discourage Investment and hinder the expansion of Nigeria’s rapidly evolving digital economy. A more constructive approach would involve structured engagement between regulators and cryptocurrency platforms, facilitating open dialogue and collaboration. This could lead to the development of a regulatory framework that not only ensures compliance with legal and economic priorities but also supports innovation and long-term growth in the sector.
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As the legal battle unfolds, the case is expected to draw international attention, given Binance’s global influence and Nigeria’s role as a key player in Africa’s cryptocurrency market. The outcome could shape how other governments approach digital asset regulation, especially in emerging economies where crypto adoption is rising. Whether through court rulings or negotiated settlements, the lawsuit highlights the ongoing tensions between regulators and decentralised financial platforms, highlighting the challenges of integrating digital currencies into traditional economic structures.