Binance Adds Fiat Gateway for Naira Crypto Investments
By Chibuike Osigwe
Binance, the world’s largest cryptocurrency exchange by trading volume, announced on Monday that the exchange has now added a fiat gateway — a feature that allows users to buy Bitcoin and other cryptocurrencies using fiat currencies — to enable users deposit and withdraw naira using their Binance wallet.
The announcement was made on the Binance official announcement page and via their social media handles.
“Binance is pleased to announce that it has added a fiat gateway for Nigerian naira (NGN) as part of Binance’s mission to increase the adoption and mainstream accessibility of crypto,” the company said in the statement. “Users are now able to deposit and withdraw NGN to and from their Binance wallets.”
This feature will help reduce the difficulties and challenges encountered by crypto traders and merchants after the Central Bank of Nigeria (CBN) forbade banks and other financial institutions from facilitating crypto transactions since February last year.
Ever since the CBN crackdown on crypto, Nigerians have adopted the peer-to-peer (P2P) system in buying and selling cryptocurrencies, moving the P2P adoption to an all-time high in Nigeria. Although the P2P system reduced some of the crypto transactional challenges, it still didn’t halt it fully as many bank accounts belonging to suspected and confirmed crypto traders were closed down.
Nigerian crypto traders accepted the new development with great optimism but with caution as traders continue using the well adopted P2P system for their crypto transactions.
To avoid fraud while using the new naira fiat gateway, Binance emphasized that users need to complete their Know Your Customer (KYC) requirements on the Binance before they can use the new feature for deposit and withdrawal.
This of course is a great way of making sure that anyone using the fiat gateway for transactions is verified and if fully utilized is safer and easier compared to P2P transactions.
Using the fiat gateway also maintains that naira funds are completely housed on the Binance wallet — which can be used like other Fintech apps. While this is a welcome development for many, others see it as a centralized system as transactions and funds will be controlled by a centralized entity — in this case, Binance.
In general, the new fiat gateway is a very good development, as it eases the challenges in crypto transactions, a way of returning crypto transactions back to how it used to be on Binance. However, it might not be fully utilized by Nigeria crypto traders in the short term until a clear usage of the feature is seen, which supposedly should be unaffected by unfavorable decisions from regulators.