- OKX has decided to exit Nigeria due to recent changes in local laws and regulations
- Customers have until August 30 to empty their accounts
- Nigerians have increasingly turned to the crypto sector as a safer alternative to the naira during the financial instability
The world’s second biggest crypto exchange, OKX, is to pull out of Nigeria following a regulatory clampdown. The exchange told crypto outlet The Block that a change to “local laws and regulations” means that it is unable to serve its Nigerian customers from August 30, advising them to remove all funds. The news comes two weeks after KuCoin Africa introduced a 7.5% tax on each transaction fee for Nigerian users as the country grapples with a financial crisis that has led to many seeking the crypto sector as a safer haven for their money than the sovereign currency, the naira.
Nigeria’s Crypto Clampdown
OKX didn’t state which particular laws led to its actions, stating only that they were problematic enough to warrant an exit:
OKX is committed to adhering to the applicable rules and regulations of all jurisdictions in which we strive to offer services. Due to local laws and regulations, we notified local customers that we would no longer offer services to customers in Nigeria from August 30.
Nigeria has been clamping down on crypto trading since 2021, blocking access to major cryptocurrency exchanges, including Binance, Coinbase, and Kraken earlier this year as ordered by Nigeria’s telecoms regulator.
Binance Targeted
In February, the governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, discussed the flow of illicit funds through crypto exchanges, expressing concerns about their sources. Cardoso claimed that $26 billion had passed through Binance Nigeria in the past year alone, without adequate identification of the sources and users.
This was the same day as Binance’s compliance chief, Tigran Gambaryan, was arrested in the country for allegedly helping Binance breach taxation laws and help launder billions.
Cardoso also revealed that Nigeria’s anti-corruption agency, police, and national security adviser would be collaborating on an investigation into cryptocurrency exchanges, part of which includes a demand to see a list of Binance’s Nigerian users since its inception.
Since that announcement, KuCoin has added 7.5% in value-added tax (VAT) to each transaction fee in an effort to comply with Nigeria’s updated VAT Act, and it may be that OKX wasn’t prepared to levy such a cost to its customers.
