Changpeng Zhao, the CEO of Binance, said the recently banned Binance Nigeria Limited has been issued with “a cease and desist notice.” Zhao, who has since branded the Nigeria-registered company a “scammer entity,” told his followers not to believe everything they read in the news.
Binance Disassociates Itself From Banned Nigerian Entity
The CEO of Binance, Changpeng (CZ) Zhao, recently said his firm had issued a “cease and desist” notice against Binance Nigeria Limited, the supposed affiliate of the crypto exchange platform. In a June 18 tweet, CZ also told his followers not to believe everything they read in the news. However, the tweet did not explain how Binance is going to enforce the order against the “scammer entity.”
Binance have issued cease & desist notice to the scammer entity "Binance Nigeria Limited".
Don't believe everything you read in the news.
— CZ
Binance (@cz_binance) June 18, 2023
The Binance chief’s clarification about the crypto exchange’s relationship with the Nigerian entity came just over a week after the Nigerian Securities and Exchange Commission (NSEC) declared Binance Nigeria Limited’s operations in the country illegal. As reported by Bitcoin.com News, the Nigerian regulator also told Binance Nigeria Limited to “stop soliciting Nigerian investors in any form whatsoever.”
Following the NSEC’s declaration and warning to the Nigerian public, a spokesperson for Binance was quoted in a report distancing the leading crypto exchange from the Nigerian entity.
Meanwhile, in the same report, an individual known as Ahassan Ifzal Mughal is quoted confirming Binance Nigeria Limited’s non-affiliation with Binance. According to the report, Mughal had registered Binance Nigeria Limited with the hope of eventually selling the incorporated entity to CZ’s Binance.
“We are willing to hand over full control of Binance Nigeria Limited to binance.com should they choose to legally enter into the Nigerian market, and are further available to provide our legal services to them in obtaining legal regulatory compliance in Nigeria,” Mughal reportedly said.
While some have questioned CZ’s belated move to disown the “scammer entity,” a Nigeria crypto industry insider told Bitcoin.com News that it is possible that Binance was not aware that the now-banned entity had been using its name. To support this assertion, the insider pointed to 6 Nigerian organizations on the Corporate Affairs Commission portal which use the name Binance.
Senator Ihenyen, the lead partner at Infusion Lawyers, said while Binance’s move may seem surprising to some, the illegal use of well-known brands or trademarks is “a menace genuine companies or brand owners face across the world, including Nigeria.” Ihenyen stated that his firm has handled many cases wherein this practice which is known as cybersquatting has been perpetrated.
“As the Lead Partner of a law firm in the African market, we have handled similar matters involving cybersquatting in and outside the blockchain space. Here, an entity’s name, domain name, trademark, etc. is registered without due authorization in the hope of reselling them for profit. So “Binance Nigeria Limited” may just be one of many instances of this menace. This is Cybersquatting.,” Ihenyen explained.
The lawyer also stated that while this practice is illegal in Nigeria, many still see it as a legitimate practice.
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