Cryptocurrency ban: KuCoin suspends naira peer-to-peer trading

Popular cryptocurrency exchange KuCoin stated on Wednesday that its fast-buy service using naira cards and peer-to-peer naira services would be temporarily suspended.

The decision was made just a few weeks after the Nigerian Securities and Exchange Commission met with important national cryptocurrency players and advised them to stop trading naira to naira P2P due to the naira’s present instability.

Although KuCoin stated that the suspension was due to ongoing efforts to improve its services, many people think the action was taken in response to regulatory pressure from the Nigerian government.

With this news, KuCoin joins the ranks of cryptocurrency exchanges that have stopped offering P2P services in Nigeria. Binance and OKX were the first to do so earlier this year, when they eliminated support for naira from their platforms.

Part of its statement on X (formerly Twitter), read, “We regret to inform our Nigerian users of the temporary pause of our P2P services.

“We are eagerly looking forward to resuming the P2P Nigerian Naira (NGN) services and fast-buy service via Naira cards in a fully compliant manner,” the exchange said.

The suspension has left many Nigerian cryptocurrency users in limbo, wondering when services will resume.

However, KuCoin has assured users that they will be notified when the services are restored, but no timeline has been provided.

Nigerian authorities have been clamping down on cryptocurrency exchanges in recent months, citing concerns over the impact on the local currency, the naira.

A few weeks ago, fintechs and banks were directed to stop opening new banks and report any accounts involved in cryptocurrency transactions.

This directive coincided with the move by the Economic and Financial Crimes Commission to block thousands of accounts involved in crypto trading.

In 2021, the Central Bank of Nigeria had previously ordered banks to close accounts transacting in or operating cryptocurrency exchanges, saying such transactions are “prohibited.”

Despite the prohibition, cryptocurrency adoption in Nigeria grew, with the country rising to second place globally on a crypto adoption index in 2023. Nigerians have increasingly used crypto to protect their savings as the naira has plummeted in value.

Experts said the crackdown will likely force millions of Nigerians to turn to riskier peer-to-peer transactions and damage the country’s reputation. They argue a more balanced regulatory approach is needed to safeguard interests while promoting innovation.