Despite the Nigerian government’s claim of blocking significant funds tied to sponsors of the #EndBadGovernance protests, some cryptocurrency wallets linked to the movement remain active.

Nuhu Ribadu, the National Security Adviser (NSA), announced during a Council of State meeting convened by President Bola Tinubu at the Aso Rock Villa in Abuja on Aug. 13 that the government had blocked 83 billion naira ($52 million) in cryptocurrencies and fiat traced to the protest sponsors.

Government’s freeze claim

This includes $50 million in cryptocurrency, $38 million supposedly frozen in four wallets, and N4 billion allegedly contributed by political actors from Abuja, Kano, Kaduna, and Katsina.

However, a local media scan of the wallet addresses indicatesdiscrepancies in the government’s claim. Some of these wallets continue to perform transactions or show incorrect balances.

For instance, one wallet reported a balance of $967 and showed only $172 upon inspection, while another wallet, supposedly holding $443,512, had $233,574, according to blockchain data.

These wallets, traced to the KuCoin and MEXC exchanges, have been actively sending and receiving funds, contradicting the government’s assertion of their inactivity.

One notable transaction involved transferring $50,000 to an unknown wallet and quickly moving the funds to another address. While the identities of the wallet owners remain undisclosed, it is possible that the exchanges holding these wallets have shared information with authorities.

Regulatory challenges exposed by crypto transactions

According to local media, a crypto forensic expert explained that the government could write to an exchange to support an investigation if crime proceeds are in a wallet.

However, the expert added that exchanges are not obligated to comply with government requests unless there is a substantial legal basis, and they often resist such demands if they seem unfounded.

The Economic and Financial Crimes Commission (EFCC), which requested the freezing of these wallets, is investigating the funds for alleged money laundering and terrorism financing.

This adds a layer of complexity to the situation, as the ongoing transactions and balance discrepancies cast doubt on the effectiveness and transparency of the government’s actions.

The ongoing activity in these wallets highlights the challenges governments face in regulating and monitoring cryptocurrency transactions. Unlike traditional financial systems, blockchain technology offers a degree of anonymity and decentralization, making it difficult for authorities to enforce freezes and track funds effectively.

During the #EndBadGovernanceInNigeria protests, voices from Nigeria’s cryptocurrency community called for industry-specific demands to be included.

The movement sought to address myriad governance issues and was seen as an opportunity to push for regulatory reforms that could significantly benefit the industry and the broader economy.