The tax evasion case against cryptocurrency exchange Binance in Nigeria has been adjourned to April 30, giving the country’s tax authority time to respond to a legal request from the exchange. The Federal Inland Revenue Service (FIRS) is seeking $2 billion in back taxes and $79.5 billion in damages for alleged economic losses resulting from Binance’s activities in Nigeria. The agency claims that Binance has a significant economic presence in the country and should be subject to corporate income tax, including payments for 2022 and 2023, along with a 10% annual penalty on unpaid amounts.
The case has been delayed due to a jurisdictional dispute over the service of documents. Binance has applied to annul a prior court order allowing the FIRS to serve documents by email. Binance’s lawyer argued that the service was invalid because the FIRS did not obtain judicial leave to serve legal papers outside Nigeria. Binance, registered in the Cayman Islands, does not have a physical presence in the country.
The court granted an adjournment to allow the tax authority to respond to Binance’s motion formally. At the next hearing, the FIRS is expected to present arguments supporting the validity of the court-sanctioned substituted service.
These proceedings are part of a broader crackdown by Nigerian authorities on crypto-related platforms, which have been accused of destabilizing the country’s currency markets. In 2024, two Binance executives were detained as part of an investigation into the exchange’s role in facilitating naira-denominated crypto transactions. Authorities allege that platforms like Binance have undermined official exchange rates and facilitated capital flight through peer-to-peer markets.
While Binance is not officially licensed to operate in Nigeria, local users continue to use it to access digital assets and stablecoins. The outcome of this case will have implications for the regulation of cryptocurrency exchanges in Nigeria and could set a precedent for future legal action against similar platforms.
In conclusion, the tax evasion case against Binance in Nigeria highlights the growing regulatory scrutiny faced by cryptocurrency exchanges in the country. The outcome of this case will have far-reaching implications for the industry and could shape the future of crypto regulation in Nigeria. Stay tuned for updates on this developing story.