Binance Gets Rekt By Nigeria, Philippines, Russia (Kind of)

Binance continues to be the world's biggest crypto exchange but the world isn't exactly bigging it up.

Changpeng Zhao (CZ) exited Binance nigh on four months ago but the firm continues to be plagued with issues. He's probably too busy with his new Giggle Academy to care though. Yes, it's a real thing.

Now under the command of former MAS executive Richard Teng, the Binance ship is still struggling to navigate its way out of troubled waters, despite its skipper's best efforts.

In an effort to further differentiate Binance's various products, and perhaps protect more valuable entities, Teng recently spun off Binance's $10 billion venture capital arm, Binance Labs.

The Binance Labs website declares it is “an independent venture and not part of the Binance Group nor is it involved in any of the businesses operated by the Binance Group (including but not limited to the Binance cryptocurrency exchange).”

But this hasn't stopped regulators around the world from turning their back on the crypto giant. As CNBC reporter MacKenzie Sigalos recently said, “What doesn’t look good is that Binance is not paying its taxes in multiple jurisdictions so a lot of countries now taking issue with the exchange.”

A Filipino Block

This one comes as no surprise (the others aren't all that shocking either). In November, the Philippine Securities and Exchange Commission (SEC) warned citizens against using the crypto exchange, which was put on notice for operating without a license.

Binance was told that it had until the end of February to address the problem and that if it failed to do so, the SEC would block its operations.

In a release on Monday, the SEC's said Binance failed to obtain the necessary license from the commission to operate as an investment and trading platform and will therefore be blocked.

The regulator said Binance posed a "threat" to the safety of Filipino investors' funds.

"The SEC has identified the aforementioned platform and concluded that the public’s continued access to these websites/apps poses a threat to the security of the funds of investing Filipinos," SEC Chairman Emilio Aquino said.

Binance has a daily trading volume of $65 billion, supports over 402 cryptocurrencies, and has more than 183 million users in the country.

The ban will be enforced within three months to offer investors time to exit their positions on Binance. Google and Meta were also asked by the SEC to block Binance-related advertising from being displayed on their platforms.

Nigeria's Tax Charges

Regular Blockhead readers will be fully aware of Binance's recent tussle with Nigeria. For those who aren't - shame on you - Nigeria’s Department of State Security detained two Binance executives and confiscated their passports earlier this month.

The Central Bank of Nigeria's governor, Olayemi Cardoso, said Binance Nigeria "witnessed suspicious flows” of money in 2023.

More interestingly still, the two executives - U.S. citizen Tigran Gambaryan and British-Kenyan Nadeem Anjarwalla - were in Nigeria to address allegations that the exchange's activity had crashed the country's national currency, the naira.

In the latest chapter of this Nigerian saga, one of the two Binance executives has escaped custody. “We were made aware that Nadeem is no longer in Nigerian custody. Our primary focus remains on the safety of our employees and we are working collaboratively with Nigerian authorities to quickly resolve this issue,” a Binance spokesperson told CNBC.

Interpol is in conversation with Nigeria to secure an international arrest warrant for Anjarwalla but his wife, Elahe Anjarwalla, said she was “completely heartbroken” that he would not be home in time to celebrate their son’s first birthday.

“Nadeem has no authority to make high level decisions at Binance and I am once again asking from the bottom of my heart that the Nigerian authorities please allow him and Tigran to return home whilst they continue their discussions with Binance. I am also calling on the British and Kenyan governments to do more to get Nadeem back home to us,” she said.

Gambaryan's wife, Yuki, said pleaded with the Nigerian government for his return. “Tigran is globally recognized for his work in law enforcement and many of his peers would say that Tigran’s continuous efforts are what keep crypto currencies safe and clean,” she said.

“Please let him come home to continue this good work. The longer that our husbands are away from our families, the harder it is becoming for us to go about our daily lives.”

While these Binance executives find themselves caught in an international tug of war, Nigeria’s Federal Inland Revenue Service (FIRS) has placed four new charges for tax evasion against Binance.

The charges, filed with the Federal High Court in Abuja, allege that Binance failed to submit tax returns, failed to Value-Added Tax (VAT) and company income tax, and was complicit in aiding customers to evade taxes.

Nigeria's government also alleges Binance laundered $26 billion through its platform.

From Russia With CommEX

OK, this one isn't directly related to Binance as the other stories but is still synonymous with the exchange.

CommEX, the successor of Binance in Russia, is shutting down its website and operations on 10 May. As of Monday, new users are no longer allowed to register on the platform.

"We advise users to promptly close positions, withdraw assets, and manage their assets on the platform," the statement said.

Binance sold its entire Russian business to CommEX in September 2023. The exchange claimed there was no revenue split from the sale at the time.

Representatives from Binance said the exchange is aware of CommEx's decision to cease operations but clarified that it will not affect Binance's stance.

“Our decision to exit the Russian market remains unchanged, and we are currently in discussions with several service providers regarding the sale of our Russian business," Binance said.

"We plan to permanently wind down all exchange services and business operations of Binance in Russia, making every effort to ensure a smooth experience for users during this transition.”

Last year, Binance suspended P2P transactions in Russia, severing ties with five sanctioned local banks.

“When gaps are pointed out to us, we seek to address and remediate them as soon as possible. In line with our ongoing commitments, payment methods on the Binance P2P platform that do not fit with our compliance policies are not available on our platform," a Binance said at the time.