Nigerian BDC Operators Urge FG to Ban Binance to Strengthen Devalued Naira
Binance is a global online exchange platform where users can trade cryptocurrencies regularly, supporting a wide range of commonly traded digital assets.
Binance’s Dominance in Liquidity Generates Concerns
According to NAN, Alhaji Aminu Gwadebe, the President of ABCON, raised concerns about Binance’s increasing influence in the trading landscape.
Gwadebe stated that Binance has become the go-to platform for investors and exporters, dominating both the Investor and Exporters window and the parallel market.
With an impressive trading volume of 1.2 million transactions per second, Binance stands as the most liquid market; hence Gwadebe harped on the need to challenge this dominance through local content and unique market characteristics.
Gwadebe expressed his concerns also regarding the prevailing pessimism in the foreign exchange market, highlighting that it erodes market confidence.
He, however, attributed the pressure on the naira to various factors such as currency hoarding by banks and oil companies, school fee payments, speculative activities, and round-tripping.
Gwadebe commended the current government’s efforts in combating illegal behavior in the foreign exchange market, emphasizing the objective of unification.
Gwadebe expressed hope that the recent removal of petrol subsidies would enable the Central Bank of Nigeria (CBN) to receive remittances from the Nigerian National Petroleum Corporation (NNPC).
He hinted that when the subsidy was in place, the remittance to the CBN from NNPC was zero, stressing that this change could provide the CBN with the necessary liquidity and inflows to defend the naira.
Gwadebe highlighted the importance of creating a friendly, competitive, and transparent system to attract more investors to the market.
The ABCON President urged the National Assembly to enact legislation that safeguards investors in the market, noting that strengthening investor protection measures can attract more participants and contribute to market stability.
Gwadebe discredited reports of the Central Bank of Nigeria revoking licenses of 2,698 Bureaux De Change (BDC) operators, maintaining that the list provided was incorrect and unconfirmed.
He affirmed that the CBN has not released an official comprehensive list stating which licenses have been revoked or remain valid.
Recall, BDC operators have called for increased participation in the foreign exchange market to ensure the success of the new exchange rate policy implemented by the CBN.
They expressed dissatisfaction with the exclusion of BDCs from the Investors and Exporters window, as they play a crucial role in addressing the retail end of the market and maintaining exchange rate stability.
