By Chinenye Anuforo [email protected]
A professor of applied economics at Johns Hopkins University, Steve Hanke, has joined scores of tech professionals in calling for the release of two Binance executives, Tigran Gambaryan and Nadeem Anjarwalla, detained recently by the federal government, saying their prolonged incarceration was wrong as they were not responsible for Nigeria’s wobbling economy.
The government arrested the duo after restricting access to several crypto platforms, including Binance.
While insisting that the Nigerian government’s anger was misdirected, Hanke said Nigeria’s economic instability sprang from policies implemented by the fiscal and monetary wings, which have led to a drop in foreign exchange inflows and ultimately destabilizing the economy.
He said it had nothing to do with Binance as neither the platform nor cryptocurrency was responsible for Nigeria’s economic challenges, and advised the federal government to release the Binance officials immediately.
He said: “With the naira plunging and inflation surging, Nigeria has hit the panic button, recently forcing Binance to halt its operations. Crypto speculation is not the source of Nigeria’s problems.”
Hanke is the founder and co-director of the university’s Institute for Applied Economics, Global Health, and the Study of Business Enterprise.
His advise follows that of another crypto enthusiast from Nigeria, Mr. Bright Johnson, who argued that Nigerian authorities seem to be lashing out at crypto exchanges, seeking to make them the scapegoats for the naira’s recent devaluation against the US dollar and the country’s soaring inflation rate.
He added that detaining the Binance employees could backfire on the government, derailing its efforts to protect Nigeria’s economic interests.
According to Hanke, “Crypto exchanges are not the cause of Nigeria’s economic and inflation woes; this stems from more deeply entrenched policy challenges, global headwinds impacting commodity prices, and other macroeconomic factors beyond the control of any single company. Blaming Binance and seeking to penalise it with dramatic actions like these detentions creates an adversarial climate that will deter investment rather than encourage productive engagement”.
In a chat with select newsmen recently, Johnson said: “The wiser path forward for Nigerian policymakers is to recognise the inherent leverage the country possesses as a major African economic force. In the past, Binance expressed its willingness to comply with appropriate regulations to ensure the sustainability of its operations in this key market. Other major crypto players have indicated the same. However, the actions of the Nigerian government are doing little to encourage these major global crypto exchanges to pursue these objectives.
“By opening a constructive dialogue and developing sensible regulations around crypto, in collaboration with global leaders, Nigeria could bring real transparency, accountability and oversight to the crypto sector – all while maximising the economic rewards and preserving the country’s valuable status as an African innovation hub.
“Doubling down on an adversarial, enforcement-led approach is counterproductive and short-sighted. The detention of the two Binance employees is unlikely to speed up any sort of resolution to whatever legitimate concerns the Nigerian authorities may have. If anything, it slows down, or completely halts, the critical conversation around how crypto exchanges can properly register as regulated businesses, meet robust standards and disclosures, and ultimately help Nigeria realise crypto’s economic development potential.
“Nigeria is right to want a well-regulated crypto market and accountability for any illicit activity. But alienating some of the leading players is self-defeating. You cannot detain your way to better crypto policies or improved economic growth. The government should release the detained Binance staff and open a collaborative conversation, befitting Nigeria’s regional economic power and influence. The true leverage the Nigerian government has, lies not in enforcement, but in making access to Nigeria’s market too important and valuable for global crypto participants to ignore. It’s also an approach that has the best chance of ensuring unwillingness on the part of these crypto market participants to jeopardise their presence in Nigeria by failing to comply with legal requirements” he added.
The federal government recently restricted access to several crypto platforms including Binance, recognised as the world’s largest crypto exchange.
Following this action, two Binance executives, American citizen Tigran Gambaryan and Nadeem Anjarwalla who holds UK and Kenyan nationality, who came to negotiate with the government, were detained and have remained in detention without any formal charges against them.
Hanke said these Executives are unfairly detained because they may not directly have a hand with the economic situation of the country.