As Nigeria faces soaring inflation and a rapid decline of the naira, the government is turning its attention to cryptocurrency exchanges.
However, many within the Nigerian crypto community believe that halting naira trading on these platforms could worsen the situation.
Rume Ophi, executive secretary of the Stakeholders in Blockchain Technology Association of Nigeria (SiBAN), argues that blaming cryptocurrency platforms for the naira’s depreciation is misguided.
Instead, he suggests that effective regulation, rather than an outright ban, could provide a more practical solution.
Nigeria’s inflation rate has surged to a nearly three-decade high of 29.9%, prompting authorities to scrutinize cryptocurrency exchanges.
These platforms have been accused of contributing to the naira’s devaluation by establishing an informal exchange rate.
However, experts like Iwa Salami, an associate professor at the University of East London, contend that cryptocurrency is being unfairly targeted.
In her recent opinion piece, Salami emphasized that while crypto is often linked to illicit activities, it has never been directly responsible for currency devaluation.
She advocates for a balanced regulatory approach that protects financial stability without stifling innovation.
Earlier this year, Nigerian authorities intensified their crackdown on cryptocurrency trading platforms, with Binance among those facing scrutiny and charges, including tax evasion.
Despite this, Salami and other experts believe that leveraging existing regulatory frameworks, such as those introduced by the Nigerian Securities and Exchange Commission in 2022, could be more effective.
These frameworks require exchanges to identify wallet holders involved in suspicious activities, providing oversight while supporting the growth of the industry.
