Binance in talks to create virtual free zone in Nigeria

Monday 5 September 2022 15:12 CET | News

The Nigeria Export Processing Zones Authority (NEPZA) has teamed with crypto FX Binance to create a virtual free zone for blockchain development.


The NEPZA revealed that preliminary meetings with Binance had taken place to create the virtual free zone, which would be the first of its kind in West Africa. 

The Managing Director of the NEPZA, Adesoji Adesugba, stated, according to Voice of Nigeria, that the zone would resemble Dubai’s virtual free zone, whose regulations and incentives are designed to fit crypto firms. ‘Our goal is to engender a flourishing virtual free zone to take advantage of a near trillion dollar virtual economy in blockchains and digital economy,’ said Mr Adesugba.

The Nigeria Export Processing Zones Authority (NEPZA) has teamed with crypto FX Binance to create a virtual free zone for blockchain development.

Crypto usage in Nigeria

With 33.4 million owning or trading crypto assets, according to Kucoin, Nigeria’s population is among the most enthusiastic in Africa in terms of cryptocurrencies and blockchain adoption. However, authorities have previously sent less receptive signals. In February 2021, the central bank banned banks from servicing crypto exchanges; in November 2021, it was reported that the central bank asked banks to freeze the accounts of at least two individuals trading cryptocurrency, leading banks to generally monitor accounts in search of such trading.

In October 2021, Nigeria’s central bank launched the digital currency eNaira in the hope that it would facilitate cross-border trade and everyday transactions (as half the population cannot access bank accounts), as reported by Al Jazeera. The currency was only the second central bank digital currency (CBDC) ‘fully open to the public after the Bahamas,’ as noted by the IMF.

Kucoin’s research suggests that the sharp depreciation of the Nigerian currency (209% in the last six years) is a major factor in the popularity of cryptocurrency in the country, as well as the economic hardships of the pandemic. ‘52% of Nigerian crypto investors allocate over half of their assets to cryptocurrencies,’ according to Kucoin, and ‘70% (...) intend to increase their cryptocurrency investments over the next 6 months.’ Over half think crypto is a ‘reliable value-storage and payment means.’

Across Africa, Kucoin finds that the number of users of cryptocurrency has soared by 2467.2% between January 2021 and January 2022, and the average number of monthly transactions has leapt by 1386.7%.

Binance expansion journey in the Middle East

In June 2021, Binance signed an agreement with the Securities and Exchange Regulator of Cambodia (SERC), by which it would share its expertise on digital assets and help develop a legal framework to regulate them. 

In March 2022, Binance gained the licence to operate in Bahrain. In December 2021, Binance signed an agreement with the Dubai World Trade Centre Authority, by which it agreed to help a variety of digital currencies and assets to obtain a licence in Dubai.

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Keywords: product launch, Bitcoin, cryptocurrency, cryptocurrency exchange
Categories: DeFi & Crypto & Web3
Companies: Binance
Countries: Nigeria
This article is part of category

DeFi & Crypto & Web3


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