A Federal High Court in Abuja has taken fresh action in the $79.5 billion lawsuit filed against Binance Holdings Limited by the Federal Inland Revenue Service, marking a critical step in Nigeria’s efforts to regulate cryptocurrency activities and enforce tax compliance. Presided over by Justice Inyang Ekwo, the court adjourned the case until April 7, giving the tax authority additional time to press its claims against the global cryptocurrency exchange. The lawsuit alleges that Binance has caused significant economic losses to Nigeria through its operations and demands billions in damages for violations of tax laws and financial regulations.
The Federal Inland Revenue Service has asked the court to compel Binance to pay an additional 10 percent penalty for non-payment of income tax for the years 2022 and 2023. The agency is also demanding a 26.75 percent annual interest charge, based on the prevailing Central Bank of Nigeria lending rate, as compensation for what it describes as lost revenue due to Binance’s alleged non-compliance with Nigerian tax laws. The allegations against Binance include providing financial services in Nigeria without proper regulatory approval and failing to comply with the country’s anti-money laundering and fraud prevention laws.
Authorities in Nigeria have increasingly intensified their crackdown on cryptocurrency platforms, citing concerns over unregulated transactions, illicit financial flows, and tax evasion. Binance, as one of the world’s largest cryptocurrency exchanges, has faced mounting scrutiny not only in Nigeria but in several other countries where regulators are questioning its compliance with financial laws. The case against Binance is being closely watched by financial experts and investors, as its outcome could set a significant precedent for how Nigeria and other emerging markets regulate digital asset platforms. If the court rules in favor of the Federal Inland Revenue Service, it could signal stricter enforcement actions against other cryptocurrency exchanges operating in Nigeria without full regulatory compliance.
The lawsuit is part of a broader effort by the Nigerian government to assert greater control over digital asset transactions and ensure that companies profiting from Nigerian users contribute their fair share in taxes. The Nigerian authorities argue that platforms like Binance facilitate large-scale transactions that often bypass the nation’s financial laws, resulting in potential revenue losses for the government. The case has sparked widespread discussions about the future of cryptocurrency regulation in Nigeria, with some experts warning that overly aggressive enforcement could drive digital asset platforms underground, while others argue that stricter regulation is necessary to protect the financial system and curb illicit transactions.
The outcome of this case could have far-reaching implications for cryptocurrency exchanges, financial institutions, and digital asset investors in Nigeria. With billions of dollars at stake, both Binance and the Nigerian government are likely to put forward strong legal arguments in what could become one of the most consequential regulatory battles in Nigeria’s financial sector. The court’s final decision could shape the country’s approach to cryptocurrency regulation for years to come, influencing whether Nigeria adopts a more open stance toward digital assets or imposes stricter measures that could deter global crypto firms from operating within its borders.
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