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Nigeria and Binance – The Candid Ugly Truth

Nigeria and Binance – The Candid Ugly Truth

The relationship between Binance and Nigeria has never been straight forward. At different points along the way, different agents claiming to be ‘Binance’ have been conducting business in Nigeria, only for Binance itself, authorities, or both to come forward disowning and distancing themselves from various activities associated with the name ‘Binance’

At one stage there could have been the question – ‘Will the real ‘Binance’ please stand up?’

I’ve stayed out of this argument up to now, as I am no big fan of Binance.

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I am of the view some Eth based developments, especially ERC 20 spawned some income strands that have brought the cryptocurrency/blockchain/web3 business into serious disrepute. Binance is heavily leveraged on EVM Compatibility for its success.

Weaknesses and exploit conditions of multiple kinds exist wherever there are ‘0x’ strings and Solidity code, irrespective of if they are in stand-alone solutions, linked to Ethereum, or extending exotic cross-architecture services with other things.

Binance in particular has been mired in disputes. The previous leader was forced to step down. Changpeng Zhao, a Canadian citizen born in China, was recently jailed for four months in Seattle.

In a separate statement Anton Golub said Changpeng Zhao (with a wealth of $33 billion) is now the richest person ever sent to a US prison

Nevertheless, this is not a case of holding oil personnel to ransom as in the last millennium. Our sector is a very fluid one, and (except a tiny club around Zhao), the links between operatives and any notion of corporate family or corporate responsibility ceases to exist.

Firstly, it’s important to understand in the EFCC context, Binance has merely been a service tool, presiding over ‘instruments’ through which unconnected parties can store ‘value’ or trade.

There is an old saying about ‘If only this 100 dollar bill could tell a story’… instruments leveraged through Binance are no different. What would happen if EFCC could prove $USD had been used by Nigerians in the conduct of illegal criminal activities? Whether Federal Reserve have knowledge of it or not, is not an issue. They can’t NOT be aware, cases of $USD being used in illegal criminal activities is a matter of public record since time immemorial! Do EFCC go after Federal Reserve (its retail actors/distributors or agents)? Well I’d like to see how that works out for them. Simply being ‘easier’ to go after a corporate rather than sovereign target for the same thing, doesn’t make it OK.

What people also routinely ‘forget’ in reporting was that at one stage EFCC legal custody expired and despite the absence of judicial authority, retained custody anyway.

That, purely on its own, is enough to force case dismissal, complete with double jeopardy clause, completely irrespective of cast iron strength around what can otherwise be proven.

Other reports hint at inter agency rivalry between EFCC and FIRS (Federal Inland Revenue Service). FIRS lawyer, Moses Ideho, claimed they made attempts to charge Tigran Gambaryan while in EFCC custody in Abuja and were denied access.

Binance executive Tigran Gambaryan being led away from the Federal High Court in Abuja on Thursday, shortly after the day's hearing.
Tigran Gambaryan leaving the Federal High Court in Abuja in EFCC custody

Journalistic narratives paint pictures of clandestine ‘devious’ methods of ‘escape’ during the window, however, this tells more about feelings of safety, and confidence in ‘due process’ and authorities in Nigeria, than it does about culpability of those detained.

What is new, is a quote from Samuel Nwite‘s article yesterday.

Richard Teng, CEO;  dropped the clanger:  “To invite a company’s mid-level employees for collaborative policy meetings, only to detain them” has set a dangerous new precedent for all companies worldwide,”

This is a bit of where my mind has been headed all along.

‘Mid Level?’ What a gross embellishment! They are far less significant to Binance than that!

Now some may say, if the Job Title fits, wear it.

But, over decades of work in Nigeria and exposure to privileged corporate content, I’ve seen past Expatriate Quota records where job titles created for NIS (Nigerian Immigration Service) consumption have little or no bearing on what many foreign employees actually do for their employers day to day. Some records are so bizarre they make works of pure Science Fiction read like Empirical Truths.

Having spent so long in the ‘Global South’ expatriate space, I’ve learnt that North American and European businesses over time have learnt to ‘protect’ themselves by not assigning from the domestic job pool to ‘Global South’ territories where they have strong intel, there is a risk of relationships with authorities ‘going south’. They are afraid of domestic rights laws. Some Chinese businesses on the other hand have equal worries, but mostly because corporate activities forced under the microscope of the Polit Bureau don’t end well.

If they can’t find the right non locals with tested metal in the field, they often source from South Asia, North Africa or The Middle East, who will have weaker legal redress against the company, and frankly, they view as being expendable, and will cut the lifeline on the first sign of local authorities starting to show ‘interest’.

It’s profoundly obvious the detained folk are absolutely nowhere in the Binance food chain.

Tigran Gambaryan, one of the detained, formally issued a decline of receiving ‘legal service’ on behalf of Binance. His legal representative, Mark Mordi, responded that Gambaryan doesn’t posess the authority from Binance to represent them in the matter.

Gambaryan is just a corporate policy advisor and voluntarily came to Nigeria, accepting an invitation as a benign request. It clearly had ulterior hidden motives. This could only be got further wrong by arresting the dude that changes the roll in the Binance office toilet in Gambaryan’s home of Armenia.

In court,  Mr Mordi said his client declined to accept service of the charge on behalf of Binance because he is not a representative of the company in Nigeria.

The ruse began earlier this year,  as the Naira to Dollar rate went into freefall with no obvious end in sight. Binance appeared as a fathomless scapegoat to the absence of strategic leadership responsible for the demise.

Trying to tackle the vehicles of value movement is merely dealing with symptoms, and any that are removed will only make space for new ones to appear. Rather than looking to ‘medicate’ against symptoms, FGN and agencies need to address the PROBLEMS (which follow).

Financial Services Actors (such as Binance) have no role in tackling violet crime and terrorism; enabling reliable, plentiful and affordable electricity; removing corruption in civil authority ecosystems; strengthening agricultural and manufacturing output; and proportionately improving sovereign passport index, and attracting more FDI though improving ‘Ease to Do Business’ index.. all things that ACTUALLY impact the exchange rate.

There were other statements made by Teng alluding to approaches by authorities for Binance to pay a bribe for charges to ‘go away’. These will not be dealt with here.

However, this kind of ‘wing and a prayer’  ‘grandstanding’ by authorities costs taxpayers money to action and prosecute. They seem committed to lumping these burdens on the impoverished citizenry for the many ill thought-out ruses they lose, as they find something to selfishly ‘eat’ on the rare occasions they win.

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