An ex-parte motion in Nigeria’s crackdown on Binance looks set to expose internal platform information to regulatory scrutiny.

A Federal High Court in Abuja, Nigeria, has issued a directive to Binance, a leading cryptocurrency exchange, mandating the surrender of user data to the Economic and Financial Crimes Commission (EFCC). The investigation revolves around suspicions of money laundering, foreign exchange rate manipulation, and potential financing of terrorist activities.

During a court hearing on March 18, EFCC operative Hamma Bello revealed that the agency's Special Investigation Team had flagged suspicious activities and petitioned Binance to halt all naira-related trading operations. Initially, Nigerian authorities sought six months of transaction records for the top 100 local users, but later expanded the request to encompass all Nigerian customers on the platform, without specifying the scope of trading activity.

The court order comes on the heels of the arrest of two Binance executives, Tigran Gambaryan and Nadeem Anjarwalla, in Abuja on February 26. Nigerian Central Bank Governor Olayemi Cardoso cited concerns over approximately $26 billion in untraceable wealth allegedly flowing through Binance, contributing to the depreciation of the naira since last year. Despite lacking data to support this claim, Cardoso warned of potential consequences, including a hefty fine of $10 billion for Binance's alleged facilitation of foreign exchange manipulation through the widespread conversion of naira to Tether's stablecoin, USDT.

In response, Binance emphasized its collaboration with Nigerian law enforcement agencies since June 2020 and urged authorities to engage with established crypto stakeholders with a track record of constructive engagement.

This development follows Binance's recent settlement with U.S. regulators, where it paid $4.3 billion in penalties and saw its founder, Changpeng Zhao, resign from his CEO position and surrender his Canadian passport pending ongoing legal proceedings.