NIGERIA has launched legal action against Binance, the world’s largest cryptocurrency exchange, demanding $79.5bn in damages for alleged economic losses and an additional $2bn in unpaid taxes, according to court documents seen by Reuters.
Authorities blame Binance for naira devaluation
The lawsuit stems from claims that Binance played a significant role in destabilising Nigeria’s local currency, the naira. Authorities accuse the crypto exchange of facilitating speculative trading that fuelled naira volatility. This crackdown escalated in 2024 when the government detained two Binance executives as part of a broader effort to curb foreign exchange speculation through cryptocurrency platforms.
Despite Binance not being officially registered in Nigeria, the government maintains that the company has a ‘significant economic presence’ in the country, making it liable for corporate income tax. The Federal Inland Revenue Service (FIRS) is pushing for the payment of outstanding taxes from 2022 and 2023, plus a 10 percent annual penalty on overdue amounts.
Demand for interest and penalties on unpaid taxes
The FIRS is also seeking a court ruling to enforce a 26.75 percent interest rate on Binance’s unpaid taxes, aligning with the Central Bank of Nigeria’s prevailing lending rate. This legal battle follows existing tax evasion charges against Binance, which include non-payment of value-added tax (VAT), corporate income tax, failure to file tax returns, and allegations of assisting users in evading taxes through its platform.
Binance under intensified scrutiny
The cryptocurrency giant, which ceased naira transactions in March 2024, is already contesting the tax-related allegations. Additionally, Binance is facing separate money laundering charges from Nigeria’s Economic and Financial Crimes Commission (EFCC), accusations it has denied.
The outcome of this lawsuit could set a precedent for how governments regulate global cryptocurrency platforms operating in their jurisdictions. Binance has yet to publicly respond to the latest claims but previously stated it was working with Nigerian authorities to address tax concerns.
