By Nkechi OgbonnaBBC business reporter in West Africa
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The Nigerian government says it has demanded almost $10bn (ยฃ8bn) in compensation from cryptocurrency company Binance.
It says Binance manipulated exchange rates through currency speculation and rate fixing, which has caused the naira to lose almost 70% of its value in recent months.
Two Binance executives were arrested in Nigeria earlier this week.
Binance has not responded to BBC requests for comment.
Nigeria is the largest economy in Africa and also one of the largest cryptocurrency markets in the world.
On Tuesday, Nigeria's central bank governor Olayemi Cardoso said Binance Nigeria had moved $26 billion in untraceable funds.
"These accusations are weighty," Tilewa Adebajo CFG Advisory tells the BBC. "It is a huge sum, even more than the Nigerian diaspora's annual remittances of $24 billion."
"The government must have done its homework, hence the accusations."
According to the Reuters news agency, cryptocurrency transactions equivalent to approximately 12% of Nigeria's total income, or GDP, were made in the year to June 2023.
Cryptocurrencies are not illegal in Nigeria, but companies must register to operate there, the government says. A special adviser to the president of Nigeria told the BBC that Binance had not done so.
After taking office last year, President Bola Tinubu scrapped the policy of pegging the naira to the dollar, allowing traders to buy and sell the currency at market-determined rates. But special adviser Bayo Onanuga said the recent collapse was not the result of normal activity.
"Suddenly the exchange rate skyrocketed... and it was caused by the people on the Binance platform," he told the BBC's Newsday programme.
"The government cannot simply sit back and allow this to continue."
Binance is understood to be one of the most popular cryptocurrency platforms in the country.
To the frustration of Nigerian users, Binance and several other cryptocurrency companies have been suspended in the country in recent weeks, including Coinbase, Kraken, Forextime, OctaFX, Crypto and FXTM, in an attempt to stop the decline of the naira.
In addition to the collapse of the naira, the government also says that cryptocurrencies are used to launder money and finance terrorism.
The "anonymity and privacy inherent in the cryptocurrency system are what attract people, particularly those with illicit intentions, to its use," according to a recent report by Nigeria's Financial Intelligence Unit.
Central bank governor Cardoso said on Tuesday that โillicit flowsโ had been detected on some cryptocurrency platforms in Nigeria. No specific company was named as the culprit.
In another move aimed at curbing currency trading, Nigeria has closed thousands of exchange offices.
Nigeria's central bank has been under pressure to stabilize the national currency, the naira, which is currently trading at 1,595 naira per US dollar, compared with about 460 a year ago.
The collapse of the naira has worsened the cost of living crisis. High prices for food and raw materials - including fuel and transport - have sparked protests in recent weeks.
Additional reporting by Natasha Booty