The ongoing legal battle between Nigerian authorities and crypto exchange Binance has significantly affected the country’s blockchain industry. The Nigeria Blockchain Industry Coordination Committee (BICCoN) recently expressed concerns over the negative impact of the current dispute and called for a “balanced resolution.”
Nigerian blockchain industry affected by Binance saga
BICCoN has issued a public statement regarding the ongoing situation legal problem involving Binance and its detained executive, Tigran Gambaryan. Nigeria’s blockchain committee has expressed the concerns of the country’s leading organizations about the repercussions this conflict could have.
The committee is a “cross-community working group dedicated to fostering a collaborative, innovative and secure blockchain ecosystem in Nigeria.” Major blockchain organizations that make up BICCoN include the Blockchain Nigeria User Group (BNUG), the Cryptography Development Initiative of Nigeria (CDIN) and the Stakeholders in Blockchain Technology Association of Nigeria (SiBAN).
BICCoN announces statement addressing Binance dispute's impact. Source: BICCoN on X
In the statement, BICCoN Chairman Lucky Uwakwe highlighted the industry’s concerns regarding the developments in the Binance case in the country and the “significant implications for the national interest, the reputation of the blockchain industry in Nigeria and our international collaborations.”
According to the blockchain committee, the prolonged legal battle against the exchange and the detention of Gambaryan and Nadeem Anjarwalla, who escaped in March, caused “adverse effects” on industry collaborations and investments and the country’s reputation.
These events have had a deterrent effect on investments, with a notable drop in foreign investments and collaborations with Nigerian web3 startups. It is worth noting that these foreign investments and collaborations are crucial in fueling innovation, creating jobs and boosting the country’s economic growth.
The president of BICCoN believes that the chances of maintaining and consolidating innovative collaborations are threatened. Uwakwe stressed that the hostile context has already affected investments.
Since the Binance saga began, there has been a “noticeable decline in investment in Nigerian Web3 startups.” In addition, the investment community is “monitoring” how the authorities are handling the conflict, as “the risk of brutal legal action could jeopardize their investments.”
Apparently, domestic investors and entrepreneurs faced more difficulty raising capital, which stifled innovation and slowed the progress of “promising projects.”
The Committee highlighted the importance of collaborations and investments from international entities to the country’s blockchain economy and ecosystem. A crackdown on the sector could leave Nigerian authorities “without the tools and expertise to effectively regulate the industry.”
A call for resolution
The next steps taken by Nigerian authorities will be crucial in mitigating the impact on the blockchain industry. As such, the committee urged the country’s government to “prioritize constructive dialogue that will lead to a healthy conclusion.”
Excerpt from BICCoN's public statement. Source: BICCoN
Furthermore, it suggests that Nigerian regulators balance their measures with a strategy of supporting the industry that promotes its growth and development in the country. However, the committee explained that there is a “delicate balance that must be struck” between Nigeria’s interest and a welcoming and vibrant landscape.
Accordingly, BICCoN recommended that the authorities engage in constructive dialogue, ensure a fair legal process and develop a clear regulatory framework. Furthermore, he suggested that the government address market concerns and strengthen its regulatory capabilities.
Ultimately, the committee believes that a commitment to transparency and due process is necessary to achieve a balanced resolution, restore trust, and maintain the country’s credibility “as a reliable partner” for international businesses and investors.
Binance Coin (BNB) is trading at $572.5 in the weekly chart. Source: BNBUSDT on TradingView
Featured image from Unsplash.com, chart from TradingView.com
