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The Warning from Nigeria's Crypto Crackdown: Is America Next?

EDITOR'S NOTES

In a stark move to prop up its faltering naira, Nigeria has slammed the door on major crypto exchanges like Binance, Coinbase, and Kraken, effectively cutting off a key financial escape route for its citizens. This desperate bid to clamp down on currency flight and wrest back control over the naira’s freefall reveals the dark side of government intervention in personal finance. As Nigeria battles to dictate the value of its currency, shutting down avenues that offer a glimpse of financial autonomy, it sends a chilling signal. WITH THE U.S. ON THE BRINK OF ROLLING OUT A DIGITAL DOLLAR, THIS SCENARIO SERVES AS A GRIM PREVIEW OF WHAT HAPPENS WHEN CONTROL OVER CURRENCY USAGE TIGHTENS: a stark reminder that the path to monetary sovereignty is fraught with peril, and perhaps, a cautionary tale of what’s to come if we don’t pay attention.

Nigeria has taken drastic measures in to attempt to stabilize its plummeting national currency, the naira, by blocking access to major cryptocurrency exchangesreported the Financial Times.

 

This move comes as the Nigerian government attempts to crack down on currency speculation amid record lows for the naira.

The Nigerian Communications Commission (NCC) issued orders to telecoms companies late on Wednesday to restrict consumer access to websites of major cryptocurrency platforms like Binance, Coinbase, and Kraken. As a result, consumers experienced only intermittent access to these sites on Thursday.

Bayo Onanuga, Special Adviser Information and Strategy to the President of Nigeria, took to X to say a local report of the government blocking access to the exchanges was correct.

Cryptocurrency exchanges have played a big role in establishing unofficial market prices for the naira, with platforms like Binance often serving as benchmarks for local foreign currency exchange rates. The government's move to block access to these platforms is an effort to regain control over the currency valuation of the naira.

“Binance, facing regulatory showdown in many countries, and causing disruptions in the currency market, should not be allowed to dictate the value of the naira, not on its crypto exchange platform,” Onanuga further stated.

 “Crypto should be banned in our country or else this bleeding of our currency will continue unabated.”

Nigeria's adoption of rash methods to defend its currency, including shutting down price-setting websites and declaring certain cryptocurrency entities illegal, highlights the challenges the country faces in managing its economic stability. 

Nigeria's national currency has lost over 70% of its value since their central bank lifted its dollar peg in June.

This article originally appeared on Zero Hedge

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