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Are your funds really safu on Binance?

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Belemo
@belemo
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4 min read

It has come to the notice of the general public that some Nigerians are being targeted on Binance exchange.

Since 2020, it has seemed like Nigerian accounts on Binance exchange were targeted and blocked. The sad part is that many of the accounts didn't get any explanation why.

One user narrated his ordeal that was captured by correspondents on Naira metrics. According to the story, this user named Adeosun Yemson Yemmy had his account blocked and when he tried to find out the reason, he was met with what can only be described as Bullshit.

Sometime in December 2020, I bought some coins from a guy on WhatsApp, Adeosun said. 24 hours later, my account was frozen. I chatted support and I was told to provide proofs on how I got a certain amount of funds into my wallet. I provided the proofs and my wallet was released. However, in February 2021, the wallet was frozen again. And up till now, they haven’t released the wallet.”

After further enquiry, the Binance support team claimed that his account was under investigation for receiving stolen funds. This is pretty wild considering he sent them proof of his WhatsApp transaction.

Unfortunately, Adeosun was unable to retrieve his funds. In fact, he was asked to speak to a police officer in USA and was further required to show up physically before in America before it can be sorted out.

Profiling and prejudice

Here's the thing though, Nigerians don't get any favours from law enforcement. Whether it's inside or outside the country, law enforcement tends to treat us like shit.

Even though there are negative elements in our midst, Nigerians are still among the hardest workers and trustworthy people on earth.

Interestingly, Nigerians are also among the top users of Binance exchange in the world. In fact, despite the crypto sanctions, we still stuck by Binance but Binance didn't return the favour.

There's nothing to it though, it's all business and in business, money wins. Nigerians aren't as rich as citizens of other countries, so Binance picks the fattest wallets and that's okay.

It just sucks that people get this kind of treatment for their own funds on an exchange.

Not your keys, not your funds

On the other side of the fence, there's the fact that if it's not your keys then it's not your coins.

Many people assume central exchanges are like banks but not quite. Nigerians also have to note that Binance or any crypto company for that matter isn't regulated, so you have to be willing to take matters into your own hands.

The lack of regulation means you don't get any protection. This means that if Binance screws you over, you're at the mercy of the company.

It is not the same with people in the US that have Binance US and a tightly regulated crypto environment. People in those countries can get support from law enforcement, as a Nigerian, if anything unsavory is traiked into your account, you're in shit.

I've interacted with many traders and what is interesting about them is the "safety" they feel with keeping their assets on exchanges. My friend @moquero once said that if he ever forgets his exchange wallet details, a simple "I forgot my password" fixes it but with a blockchain wallet, you're fucked.

Moquero is right in his own right but in both scenarios, which one is really safer?

As someone that has lost $10k worth of tokens through a hack, I feel like I've been battle-tested in this topic. Despite that breach, I still feel much safer with my tokens onchain than on an exchange that could just randomly decide to shut me out.

I remember that I didn't get any support from Binance, despite the fact that other people received support in that period. I didn't think too much of it because my case was on Binance smart chain and I was reaching out to CZ, Binance support team and virtually everybody I could reach.

Honestly, I wasn't expecting any support from CZ, I knew I was on my own but things could have been different if I was a different nationality and perhaps had a lot of followers on Twitter

The fact remains that immediately your assets leave your personal wallet and land somewhere else, you're not the owner. Binance and other exchanges give you the impression that you control those assets but in reality, the only person with access to the assets is the person with the key to that wallet address.

In summary

Keep your head on the swivel and don't trust anybody with your assets. Binance is a business and they'll prioritise customers according to where the wallets are fatter.

The Nigerian government doesn't regulate crypto, and that's a good thing if you ask me. I don't need their shitty regulations and I certainly don't want to pay tax for my hard-earned funds.

You're your only security, and you have to rely on only yourself for your safety. As Nigerians, this shouldn't be new to you considering you probably already provide your own electricity, water, physical security and pretty much everything else that governments provide in other countries.

I need to be clear that I use Binance exchange exclusively for the P2P side of things, to exchange USDT or BUSD for Naira. However, I exclusively use the platform for trading and never hold any significant amount of asset on the exchange.

Stay frosty my friends and don't get locked out. Always remember that if it's not your key, then it's not your coin.

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