Court Postpones Binance's $81.5 Billion Tax Dispute till April 30th
In a significant development, a Nigerian court has postponed a tax evasion case involving Binance until April 30, 2025. Bilateral negotiations are ongoing as the cryptocurrency exchange challenges the legal service method employed by the Federal Inland Revenue Service (FIRS).
Initiated in February, the case centers on allegations that Binance owes $2 billion in back taxes and $79.5 billion in damages incurred from a purported damaging impact on the local economy. Binance's counsel, Chukwuka Ikwuazom, recently petitioned the court seeking invalidation of an order allowing court documents to be served to the firm via electronic means. Arguments advanced by the lawyer include the absence of a registered office for Binance in Nigeria and its Cayman Islands registration.
Nigerian authorities indict Binance for maintaining a substantial economic presence in the country and, as a result, being obligated to pay corporate income tax. The government demands taxes for 2022 and 2023, plus ensuing penalties and interest. Besides this, the authorities claim Binance's operations unfavorably influence the domestic economy and the depreciation of the naira, the national currency. Accusations made against the platform involve facilitating capital flight during periods of currency instability by means of its peer-to-peer trading services.
The circumstantial case between Nigeria and Binance originates from two executive detentions in February 2024. One executive, Nadeem Anjarwalla, who holds British-Kenyan nationality, escaped Nigerian custody during house arrest and remains at large, while Tigran Gambaryan, a US citizen serving as Binance's head of financial crime compliance, was released after authorities dropped all charges allowing him to depart for medical treatment.
The upcoming hearing in April may offer respite in a larger narrative regarding regulatory compliance and the extensive presence of digital assets in developing markets, where frameworks are still evolving. As the case continues to unfold, Binance's co-founder, Changpeng "CZ" Zhao, has disengaged from the matter, agreeing in April 2025 to advise Pakistan's newly constituted Crypto Council seeking to establish progressive digital asset regulations, infrastructure, education, and accelerated adoption within the country.
Furthermore, aligning with broader efforts to regulate the digital currency sector, Nigeria's unwavering stance shapes a potential precedent for future cases linked to cryptocurrency exchanges. In the interim, the outlook of this ongoing saga hints at far-reaching implications for international crypto exchanges operating in developing markets seeking to define their regulatory footing.
- Binance's ongoing tax evasion case in Nigeria, involving allegations of owing billions in back taxes and damages, raises questions about the finance and tax obligations of cryptocurrency businesses in the country.
- As the court case between Nigerian authorities and Binance continues, it is crucial to consider the potential impact of this precedent on future regulatory compliance of cryptocurrency exchanges in developing markets.
