Nigerian crypto merchants, traders with large transaction volumes on peer-to-peer platforms, dreaded what would happen next as the country’s fiat currency, the naira, showed renewed weakness in the foreign-exchange market last week.

Those fears weren’t misplaced.

That’s because the Economic and Financial Crimes Commission, or EFCC, Nigeria’s anti-corruption agency, has frozen the bank accounts of 1,146 crypto traders, according to court documents seen by DL News on Monday.

The crypto traders are accused of foreign-exchange racketeering, currency manipulation, money laundering and terrorism financing.

“We have been made aware of your involvement in trading of cryptocurrency,” a Nigerian bank informed one of its customers via an email seen by DL News.

The affected person confirmed to DL News that he is a crypto merchant but wished to remain anonymous.

“We hereby request that you furnish us with a valid order from a court of competent jurisdiction to effect the release of your funds,” the bank’s notice said.

The EFCC, however, may block attempts by customers to retrieve their funds even if a court order allows the customers to do so.

That’s because the order secured by the EFCC said the accounts should be frozen until it completes its investigation. It has 90 days to reach a conclusion.

Since early this year, the EFCC has been part of an interagency task force that is probing alleged manipulation of the naira’s value by crypto traders.

That investigation began with Binance, which was singled out as being responsible for the naira’s worst-ever decline earlier this year. The commission has since charged the crypto exchange and two of its executives with money laundering.

Now, the EFCC appears to be turning its gaze to other crypto exchanges as it escalates its war with peer-to-peer traders.

The commission’s chairman, Ola Olukoyede, said last week that investigators have uncovered foreign-exchange manipulation on other crypto exchanges that was “worse than Binance.”

Nigerian crypto traders are no strangers to having their bank accounts frozen.

Such actions previously happened under a crypto ban regime that prohibited commercial banks from servicing exchanges and traders between February 2020 and December 2023.

In December, Nigeria’s central bank overturned the order and allowed commercial lenders to service crypto exchanges and traders.

The central bank also said last week that it wasn’t planning to reenact the crypto ban. A circular purported to be from the central bank instructed banks to freeze the accounts of cryptocurrency traders. That circular, however, was fake.

Osato Avan-Nomayo is our Nigeria-based DeFi correspondent. He covers DeFi and tech. To share tips or information about stories, please contact him at osato@dlnews.com.