Binance issues legally enforceable order to scammer entity amid ongoing battle with US SEC

Updated: 19 June 2023

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Binance, the global cryptocurrency exchange, has refuted any connection to the entity referred to as Binance Nigeria Limited in the circular released by the Securities and Exchange Commission (SEC) of Nigeria. Binance clarified that it is neither aware of nor affiliated with the mentioned entity.

SEC Nigeria’s Circular and Binance’s Response

On June 9, the Nigerian SEC issued a circular addressing the activities of Binance Nigeria Limited, highlighting its unregistered and unregulated status. The circular served as a warning to the Nigerian public, cautioning them against engaging with the entity’s crypto asset trading platforms.

The SEC’s circular explicitly stated that Binance Nigeria Limited is operating illegally in the West African country. As an unregistered and unregulated entity, it lacks the necessary authorization from the Commission to conduct its operations. The circular emphasized that any individual who chooses to engage with Binance Nigeria Limited does so at their own risk.

The circular also directed Binance Nigeria Limited to immediately halt its solicitation of Nigerian investors through any means.

In response, Binance distanced itself from Binance Nigeria Limited and emphasized that it is seeking clarity from the Nigerian SEC regarding the matter. The crypto exchange carried it to Twitter saying that it has issued a cease and desist order to the scammer entity that is posing as the company’s Nigerian subsidiary.

Binance have issued cease & desist notice to the scammer entity "Binance Nigeria Limited".

Don't believe everything you read in the news. 🤷‍♂️

— CZ 🔶 BNB (@cz_binance) June 18, 2023

According to reports, a Binance spokesperson stated:

“The entity mentioned in the circular is not affiliated with us. We are therefore seeking clarity from the Nigerian SEC and remain committed to working with them cooperatively on the next steps.”

Binance Versus SEC Lawsuit

While denying any affiliation with Binance Nigeria Limited, Binance is concurrently facing legal challenges from the United States Securities Exchange Commission (SEC). The U.S. SEC has filed 13 charges against Binance and its founder, Changpeng Zhao (commonly known as CZ). The charges include operating as an unregistered exchange, broker-dealer, clearing agency, and misrepresenting trading controls. It was alleged that despite earning billions of dollars from U.S. customers, Binance and CZ failed to register as required by the SEC.

In a recent development, U.S. Judge Amy Berman Jackson approved an agreement between Binance.US, Binance, and the U.S. SEC. This agreement led to the dismissal of a previous temporary restraining order that sought to freeze all Binance.US assets. The agreement signifies progress in the ongoing legal battle between Binance and the U.S. SEC, as the parties work towards resolving the allegations.

Binance, operating in approximately 100 countries, registered its headquarters in George Town, Cayman Islands, in 2017. Additionally, the company established a subsidiary in Mahe, Seychelles, in 2019. With its expansive reach, Binance has positioned itself as one of the leading cryptocurrency exchanges globally.

Binance’s response to SEC Nigeria’s circular and its denial of any affiliation with Binance Nigeria Limited adds another layer to the ongoing legal battles faced by the company around the world. As the regulatory landscape evolves, Binance says it is committed to working cooperatively with relevant authorities while striving to provide a secure and compliant platform for its users.

The outcome of the legal proceedings will shape the future trajectory of Binance and its operations worldwide, impacting the broader cryptocurrency industry as well.