Nigeria’s Federal High Court in the nation’s capital, Abuja, adjourned the high-profile tax evasion trial of crypto exchange Binance and two of its top executives. The court shifted the original April 8 trial to April 30.
According to the report, the Federal Inland Revenue Service (FIRS) instituted the case, alleging Binance evaded more than $2 billion in taxes. It also alleged that the exchange was responsible for the depreciation of the naira by engaging in manipulative activities in the foreign exchange market. It is demanding $79.5 billion in economic loss, together with a 10% per year penalty on the taxes owed between 2022 and 2023.
FIRS asserts that Binance enjoys “a significant economic presence in Nigeria” and should therefore pay taxes on income. Binance, however, contests the manner in which it was served court papers. According to lawyers for Binance, the court had not approved prior email service.
Binance does not have any office in Nigeria and is registered in the Cayman Islands. It is accused by Nigeria of assisting economic sabotage by its cryptocurrency services.
The tensions heightened in 2024 following the arrest of two Binance executives. This was followed by a larger-scale crackdown on cryptocurrency exchange platforms that were believed to be fueling currency speculation. One of the arrested executives, Tigran Gambaryan, made public comments upon his release last month.
Gambaryan says Nigeria used him against Binance
However, at March 26’s DC Blockchain Summit, Gambaryan recounted his experience in Nigeria. He said that the government kept him as leverage in order to squeeze money out of Binance. “They regarded me as an asset,” he asserted. “By the time it was the UN General Assembly, that had flipped. I was then considered a liability.”
He was Binance’s head of financial crimes compliance. He reported sensing a change toward the end of 2024 that meant his release was imminent.
Binance, however, asserts that it is working together with Nigerian officials. In a statement issued recently, the firm expressed that it wants to tackle the issue using the right legal avenues.
Experts state that the direction of this case will redefine Nigeria’s regulatory approach towards digital assets. On April 30, the court is set to resume examining both Binance’s motion for dismissal of the previous ruling on email based service and FIRS’s claims.
Nonetheless, this is a defining moment in the regulation of cryptos in Africa’s biggest economy. Everyone now looks to the next course of action by the court.
