Original | Odaily Planet Daily (@OdailyChina)
Author | Wenser (@wenser 2010)
On October 24, Binance CEO Richard Teng publicly stated, 'We are deeply relieved and grateful that Tigran Gambaryan has finally been released after nearly eight months of detention in Nigeria. During this difficult time, Tigran Gambaryan demonstrated immense strength, and we applaud his resilience in such harsh adversity. We are very thankful to everyone who has devoted countless hours to support Tigran's release.'
This also officially marks the end of the earlier 'Binance executive detained in Nigeria' incident, fortunately, it is a story with a happy ending.
In this incident, we may also glimpse the 'way of coexistence' between the cryptocurrency industry and government regulatory forces. Odaily Planet Daily will provide a brief retrospective on this matter for readers' reference.
Decoding Tigran Gambaryan: Former IRS agent, now executive at a cryptocurrency exchange.
In September 2021, Tigran Gambaryan officially joined Binance. It is understood that during his tenure at the IRS, he led several multi-billion dollar cyber investigations, including the Silk Road website and Mt. Gox hacking incidents.
At that time, he held the position of Vice President of Global Intelligence and Investigations at Binance. Meanwhile, Binance announced that another former IRS agent, Matthew Price, would serve as Senior Director of Investigations. Binance stated it would focus on compliance and collaborate with global regulatory authorities. CZ also stated at the time, 'The Binance investigation team now includes the world's top investigators, and this level of experience will make Binance a leader in compliance and enhance trust in Binance and the entire cryptocurrency ecosystem.'
As an experienced agent, Gambaryan investigated multiple cases involving national security, terrorist financing, identity theft, distribution of child pornography, tax evasion, and violations of the Bank Secrecy Act during his ten years in the IRS's Criminal Investigation Cyber Crime Department, which also laid a solid foundation for his involvement in cryptocurrency compliance-related businesses.
Since taking office, Gambaryan's performance has corroborated this.
In May 2022, or under his promotion, Binance announced that well-known experts in the field of global cybercrime, former European Cybercrime Centre (EC3) dark web team cryptocurrency asset expert Jarek Jakubcek, joined Binance as the Director of Intelligence and Investigations for the Asia-Pacific region.
In June 2022, Gambaryan stated that the Indian community's interest in Binance's blockchain academy content had increased, and Binance hoped to encourage wise and thoughtful participation in the Indian digital asset ecosystem through proper education, having launched a series of education programs focused on the Indian market. India can become a global hub for blockchain, cryptocurrency, and Web3 talent, and achieving this should include creating an environment for startups to nurture and grow to meet the needs of Indian customers.
In August 2022, Binance's compliance team stated that Binance was vigorously implementing KYC policies, and although it caused significant losses in a short time, the enforcement remained very firm. According to official responses, it lost 90% of its customers, with revenue losses reaching billions of dollars.
In September 2022, Binance announced the launch of the industry's first global project — the 'Global Law Enforcement Training Program', aimed at helping law enforcement agencies and prosecutors to identify financial and cyber crimes and assist in prosecuting malicious actors. The training program is led by the head of Binance's investigation team, including Gambaryan.
At that time, Binance and Nigeria were also in a 'honeymoon period', with both parties even planning to establish a digital economic zone that would help the country's entrepreneurs quickly track blockchain technology. According to a statement from Nigeria's Export Processing Zone Authority, the partnership aimed to establish a digital hub 'similar to Dubai's virtual free zone'. After all, at that time, the number of cryptocurrency holders in Nigeria had exceeded 22 million, making it the undisputed 'largest cryptocurrency market' in Africa.
But soon, time moved into 2023, and the relationship between the two parties took a sharp downturn, laying the groundwork for this year’s 'Binance executive detained in Nigeria' incident.
Nigeria VS Binance: When Cryptocurrency Institutions Face National Power
In July 2023, Nigeria's securities regulator stated in a notice that all activities of Binance were not registered with the agency and were not under its supervision, thus all cryptocurrency-related activities by Binance were illegal. The notice also ordered all cryptocurrency platform providers to stop soliciting Nigerian citizens.
In February 2024, this year, Nigeria's Central Bank Governor Olayemi Cardoso stated that in 2023, cryptocurrency funds worth $26 billion with 'insufficiently' identified sources flowed through Binance Nigeria. This finding was made against the backdrop of Nigeria facing a foreign exchange crisis and seeking to limit capital outflows, with the local currency naira reaching a historic low on Wednesday.
On February 26, two Binance executives, Tigran Gambaryan and Nadeem Anjarwalla, were detained by Nigerian officials due to charges related to money laundering and financing terrorism. (Dramatically, the latter later successfully escaped.)
In March, media reports indicated that the Nigerian government planned to claim at least $10 billion from Binance, as the Nigerian government believed Binance profited from 'illegal transactions' and harmed national interests. It is reported that Binance is under investigation in Nigeria, and the exchange has removed the Nigerian currency naira from its peer-to-peer services. Additionally, local media reported that a Nigerian court ordered Binance to provide comprehensive information on all users trading on its platform in the country. Previously, it was reported that Nigeria requested Binance to hand over information on the country's top 100 users and all transaction history from the past six months.
From this action, Nigeria's detention of Binance executives is difficult not to raise suspicion that it may be motivated by thoughts of 'collecting protection fees' or 'extorting money'.
Of course, a series of subsequent measures by the Nigerian authorities quickly brought about a new round of confusion — the repeatedly postponed hearing times and the tumultuous local situation:
At the end of March, the Nigerian government accused Binance of laundering $35 million and announced that the 'detention of Binance executives' case would hold a hearing on April 4.
In early April, according to Bloomberg, Nigeria postponed the lawsuit against Binance executives to April 19.
On April 22, Judge Emeka Nwite of the Federal High Court in Abuja, Nigeria, ruled to postpone the tax evasion hearing for Binance executive Tigran Gambaryan to May 17.
In May, Judge Emeka Nwite set June 14 as the date for a possible preliminary hearing for Binance and Gambaryan.
Despite Binance's statement in April, 'Tigran Gambaryan is a strict law enforcement professional and does not belong to Binance's management. Binance requests that during discussions with Nigerian government officials, the responsibility of Tigran Gambaryan, who has no decision-making power in the company, not be pursued.' However, Nigeria continued to pursue, and in May, the Nigerian Ministry of Information claimed it plans to investigate the $150 million bribery allegation made by Binance's CEO.
A turning point occurred in June.
On one hand, after the 'Binance executive detention incident', Uwakwe, head of the relevant community working group in Nigeria's blockchain field, expressed that investors are concerned about the potential impact of a similar fate to Binance when investing in local Web3 companies. He pointed out that parties that had already invested are gradually withdrawing their investments.
On the other hand, tax charges against Binance executives Tigran Gambaryan and Nadeem Anjarwalla proposed by the Nigerian Federal Inland Revenue Service (FIRS) have been dropped, but the relevant executives remain in prison, and the trial will take place on June 20. It is worth noting that prior to this, Tigran Gambaryan was suspected of contracting malaria and had a serious condition.
In addition, as a former employee of the U.S. government, Tigran Gambaryan's detention also drew attention from the U.S.
Fox Business Channel reporter Eleanor Terrett reported that pro-cryptocurrency U.S. congressman French Hill visited detained Binance executive Tigran Gambaryan in Nigeria, who has been suffering from malaria and pneumonia during his three-month detention. Hill stated that Gambaryan was 'wrongly detained by the Nigerian government.' The two congressmen described the difficult conditions Gambaryan faced and requested the U.S. Embassy in Nigeria to lobby for his release on humanitarian grounds.
Subsequently, it was reported that French Hill, Vice Chairman of the U.S. House Financial Services Committee, is also leading the push for the Nigerian government to release detained Binance executive Tigran Gambaryan.
Despite this, Nigeria did not directly release Gambaryan and postponed the trial of Binance's money laundering case to July 5, October, and even once postponed the bail hearing for Binance executives to October 9.
In September, Tigran Gambaryan had requested the Nigerian judge to allow him to undergo back surgery due to health issues, but his request for bail due to illness was also denied.
Until October, a group of 18 state attorneys general urged President Biden to help ensure the release of Binance executive Tigran Gambaryan, who has been detained in Nigeria since February 2024. The attorney general has requested Biden to designate Gambaryan as a hostage under the (Robert Levinson Hostage Recovery and Hostage Taking Accountability Act). According to a letter sent on October 18, the organization expressed concern over Gambaryan's deteriorating health condition and the illegal nature of his detention. Attorney General Fulmela wrote in the letter, 'His continued detention without cause not only violates his rights but poses a serious threat to his health and well-being... We have a responsibility to advocate for the rights of U.S. citizens abroad, and we urge the federal government to apply the necessary diplomatic pressure to ensure his release.'
Finally, after multiple negotiations, on October 23, the Nigerian government withdrew all charges against Binance executive Tigran Gambaryan, who had been facing trial in local detention since April. On Wednesday morning local time, a lawyer representing the Economic and Financial Crimes Commission (EFCC) announced the withdrawal of charges in the Federal High Court in Abuja.
Conclusion: Binance's path of global expansion will not stop, and cryptocurrency development will continue.
As Binance CEO Richard Teng said after Gambaryan's release, 'Binance remains committed to working with global regulators to ensure compliance and transparency in the ever-evolving digital asset space, hoping to put this incident behind us and continue to work towards a brighter future for the global blockchain industry. Nigeria's young, tech-savvy population has a keen interest in digital finance and is fully capable of leveraging blockchain technology to address economic and social challenges, looking forward to playing a constructive role in this effort.'
On the long road of cryptocurrency development, there are always some people making various efforts to promote the mainstreaming of cryptocurrency. Sometimes, when facing a complex external environment, one has no choice but to 'carry the burden forward', but the development of cryptocurrencies and digital assets will not stop because of this; instead, it will become more resilient and progress faster.
Gambaryan is just a representative and epitome of industry professionals determined to build the cryptocurrency sector, and in the future, more cryptocurrency builders will continue to forge ahead, allowing the brilliance of decentralized networks to shine upon more lands and nations.