ABCON Urges Government Action Against Binance's Naira Pressure

The Association of Bureaux De Change Operators of Nigeria (ABCON) has urged the Federal Government to halt the activities of Binance within the nation. This call comes after the association recognized Binance as a significant contributor to the pressure on the naira.

As reported by NAN, Alhaji Aminu Gwadebe, the President of ABCON, conveyed this suggestion during an interview in Lagos on Tuesday. Binance functions as a global online exchange, facilitating the daily trading of numerous cryptocurrencies. The platform boasts a wide array of commonly traded cryptocurrencies.

ABCON Identifies Binance as Key Contributor

Gwadebe, highlighting Binance's role, indicated that Binance trading has become pivotal for both the Investor and Exporters window, as well as the parallel market. Notably, he emphasized that Binance stands out as the most fluid market, recording an impressive 1.2 million transactions per second.

Gwadebe remarked, "Binance has effectively become the cornerstone of the investors and exporters window, as well as the parallel market, which is regrettable. To address this, we need to take measures to curtail Binance's influence, and the most effective way to achieve this is by enhancing our own liquidity."

Binance's Growing Dominance: ABCON President's Concerns

The President of ABCON observed a shift from optimism to pessimism in the current foreign exchange market landscape. Gwadebe stressed the pivotal role of confidence in any nation's currency, emphasizing the potential repercussions when pessimism gains traction.

He stated, "We find ourselves in a situation where optimism is waning, resulting in reduced investor interest and diminished confidence among Nigerians in the market. We are forced to rely on external financial injections as a quick solution."

Gwadebe identified various factors pressuring the naira, including foreign exchange hoarding by banks and oil companies, speculative activities, and the practice of round-tripping.

Regarding the removal of petrol subsidies, Gwadebe expressed optimism that the Central Bank of Nigeria (CBN) would witness remittances from the Nigerian National Petroleum Corporation (NNPC). This, he anticipated, would bolster the CBN's liquidity and strengthen its ability to safeguard the naira.

Furthermore, Gwadebe emphasized the importance of fostering a transparent and competitive system to attract more investors to the market. He asserted that a country's adoption of a floating exchange rate relies on substantial reserves and a robust balance of payments.

Gwadebe also urged the National Assembly to introduce legislation aimed at safeguarding investors' interests in the market.

Gwadebe raised doubts about the accuracy of the reported list concerning the withdrawal of licenses from 2,698 Bureaux De Change (BDCs) by the CBN. He emphasized that an official and comprehensive list has not been issued by the CBN yet, and the current situation remains unaffected. ABCON has interacted with the CBN, obtaining instructions on the operational prerequisites and responsibilities applicable to its members, which encompass the need to submit returns to the CBN.