Nigeria’s once-tepid stance on cryptocurrency has taken a sharp turn towards prohibition. The Nigerian government, citing concerns over Naira manipulation, is proposing a ban on P2P (Peer-to-Peer) trading platforms that utilize the local currency. This move, coupled with ongoing legal battles with major exchanges, throws the future of Nigerian crypto into uncertainty.

The Nigerian Securities and Exchange Commission (SEC) alleges that crypto participants and exchanges are manipulating the Naira’s value through P2P transactions. Emomotimi Agama, the newly appointed Director-General, suggests delisting the Naira from all P2P platforms as a remedy.

“This is one of the things we must do to save this space,” Agama emphasized regarding the government’s resolve to combat the perceived threat.

The potential P2P ban would significantly restrict Nigerian crypto investors. P2P platforms offer a convenient and often cheaper way to buy and sell crypto using local currency compared to traditional exchange channels. With the Naira delisted, Nigerians would face hurdles in entering and exiting the crypto market, potentially hindering its growth and adoption.

The regulatory heat isn’t just scorching P2P platforms. Leading crypto exchange Binance, already embroiled in a months-long tussle with the Nigerian government, felt the brunt early on. In March, Binance suspended all Naira-related services following the arrest of two executives and accusations of flouting regulations. The saga continues – Binance faces criminal charges, and its executives are entangled in a separate tax evasion battle with the Nigerian authorities.

Following Binance’s lead, OKX, another major crypto exchange, delisted the Naira from its P2P marketplace on May 3rd. While OKX didn’t explicitly cite regulatory pressure, their explanation of a “change in local market requirements” suggests a cautious approach in the face of Nigeria’s tightening grip.

The effectiveness of a P2P ban in curbing alleged manipulation remains to be seen. Crypto by its nature transcends borders, and Nigerians could potentially turn to international P2P platforms or alternative methods to circumvent restrictions. Additionally, the details of the proposed broader regulations targeting the local crypto industry are yet to be revealed.

Disclaimer: The information provided in this research report is for informational purposes only and should not be interpreted as financial or investment advice. The NFT and cryptocurrency market is highly volatile, and readers should conduct thorough research before making any investment decisions.