Cheta Nwanze, a Nigerian writer, stated that the Nigerian government arrested two employees of the cryptocurrency exchange Binance to use crypto as a "scapegoat" for the country's economic situation. Nwanze shared his statement on a June 17 episode of the Nigerian Politics Weekly podcast.
"One word: misdirection," said Nwanze. "They're looking for scapegoats. The circumstances leading to those two guys' arrests paint a picture of a government in dire and sinking economic straits, and it's looking for a lifeline."
Facing soaring inflation and a devalued currency, many Nigerians have turned to crypto to protect their savings, according to the Wall Street Journal. However, in February, the Nigerian government restricted access to several crypto platforms, including Binance. The government then detained two Binance employees who were invited there to meet with officials. The employees, American citizen Tigran Gambaryan and U.K. and Kenyan national Nadeem Anjarwalla, were initially detained without being charged with crimes.
Economist Shedrach Israel said banning Binance will not solve the devaluation of Nigeria's currency, Punch reported. "I don’t know why the cryptocurrency is being seen as sabotage on the exchange rate because the cryptocurrency is not the major means by which the dollar is flowing in Nigeria," Israel said. An estimated 10.3% of Nigeria's population, or more than 22 million people, currently hold crypto.
Jeff John Roberts, author of the Fortune Crypto newsletter, said Gambaryan is an "American hero" who served as a special agent for the Internal Revenue Service (IRS) for ten years prior to joining Binance. He has been "languishing in prison" in Nigeria after he was arrested on "spurious" charges in February and is now suffering from malaria and pneumonia. Roberts said Gambaryan's case began to gain more attention in June when a bipartisan group of sixteen Congressmen wrote a letter calling on President Joe Biden to enhance efforts to release Gambaryan. Their letter was followed by another letter from more than 100 U.S. agents and prosecutors to the U.S. State Department. Last week, members of Congress French Hill (R-Ark.) and Chrissy Houlahan (D-Pa.) visited Gambaryan in Kuje Prison in Nigeria. Nigerian government officials dropped the tax evasion charge against Gambaryan, but he is still facing a charge related to money laundering.
An April 30 report from the U.S. Government Accountability Office (GAO) found that there is a heightened risk of "corruption, fraud, mismanagement or unauthorized use of U.S. aid funds" in Nigeria. The report stated that Nigeria faces risks including piracy, corruption, weapons and narcotics trafficking, "misrule," and armed banditry, resulting in "serious social, economic, and security challenges" that undermine the Nigerian government's legitimacy. The report also noted "widespread and complex corruption" impacting Nigeria's political and security sectors.
Nwanze is a Nigerian writer who uses "big data" to analyze West Africa according to his Medium account where he shares his work with his 12.4 thousand followers.