Nigeria Is Suing Binance For $81.5 Billion Over Economic Damages And Unpaid Taxes

Nigeria is suing Binance for $79.5 billion in economic losses, which it alleges were caused by the cryptocurrency exchange’s actions in the country, and $2 billion in unpaid taxes, according to court documents seen by Reuters.

Nigerian officials condemned Binance for Nigeria’s currency problems and detained two of its executives in 2024 following cryptocurrency websites emerging as preferred platforms for trading the local naira currency.

Binance is one of the most significant crypto exchange currencies globally but is not registered in Nigeria. It did not respond to a request for comment immediately, but it formerly said it was working with Nigeria’s Federal Inland Revenue Service to tackle potential historical tax liabilities.

Why is Nigeria suing Binance?

Binance has a significant economic presence in Nigeria and is liable for corporate income tax, the inland revenue service alleges in documents viewed by Reuters. Therefore, Nigeria is looking for a court declaration that Binance pays income taxes for 2022 and 2023 and imposes a 10% annual penalty on unpaid amounts.

Additionally, the FIRS asks for a 26.75% interest rate on unpaid taxes based on the Central Bank of Nigeria’s lending rate.

Binance had previously faced four counts of tax evasion in Nigeria following a government crackdown on the industry last year. The charges include non-payment of value-added tax and company income tax, failure to file tax returns, and participation in helping customers avoid taxes through its platform. It is challenging the charges and revealed in March 2024 that it would end all transactions and trading in the naira.

Binance is battling other money laundering charges by Nigeria’s anti-graft agency, which it has contested.

Nigeria cracking down on Crypto

Last year, Nigeria was grappling with a debilitating economic crisis, with inflation soaring to nearly 30%. The Nigerian government turned its attention to cryptocurrency in an attempt to stabilize its currency, the naira (NGN).

It accused Binance of facilitating unregistered crypto exchanges which it claims has caused it to lose out on $26 billion in tax revenue. There were reports that Nigeria demanded $10 billion in compensation but both the Nigerian government and Binance have denied these claims.