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Alex Ossola: Welcome to Tech News Briefing. It’s Wednesday, March 13th. I’m Alex Ossola for the Wall Street Journal. Coming up on today’s show, why are some electric vehicle owners complaining that they can’t even open the doors of their new cars? WSJ reporter Ryan Felton tells us about the unexpected battery issue that’s taken many EV owners by surprise. And then Nigerians have been quick to adopt cryptocurrency, but the country’s government is blaming crypto exchanges like Binance for its current financial crisis. Now, two Binance employees are being detained in Nigeria. WSJ reporter Caitlin Ostroff tells us the latest and what it means for the world’s biggest crypto exchange.
But first, when you think of what powers an EV, you probably think of a big lithium ion battery that you have to recharge. Right? Well, turns out there’s another kind of battery, a 12-volt battery usually found under the hood that does important things like turn on the interior lights and open the windows. And as WSJ reporter Ryan Felton writes, these batteries aren’t always working reliably. Ryan, in some newer EV models, these 12-volt batteries are dying repeatedly and unexpectedly. Why is that? What’s going on?

Ryan Felton: Yeah, it’s kind of a tricky question because it’s not one size fits all. There have been instances where the software installed on these cars is continuing to run for extended periods of time, basically just doing more when the car’s off, for example. In some cases it’s a hardware issue. Certain components inside the smaller battery, for lack of a better word, fritzing out and need replacing. The upshot is from talking with a lot of folks that the main challenge is a lot of these companies are building EVs for the first time. We’re kind of in the earliest iteration of a lot of these cars. Cars are just more powerful and need more power to do all the stuff that’s going on. Companies are learning how to design and calibrate these batteries and maybe running into some hiccups as a result along the way.

Alex Ossola: What are some of the EV models or companies affected by this?

Ryan Felton: Some Teslas have had issues which have led the company to take steps to introduce newer lower voltage technology. Kia and Hyundai have both had issues with a couple of their very popular models. Rivian had run into a couple of instances last year where drivers found that their cars were dead. A lot of the bigger names that have released these more well-known popular models have run into these challenges.

Alex Ossola: What have EV companies said about this battery issue?

Ryan Felton: Their main points are that it is something that in the cases that we did identify were rare, were quickly addressed through various means that this is something that they keyed in on pretty fast.

Alex Ossola: So EV makers know that this is a problem. What are they doing about it, especially for some of these newer models?

Ryan Felton: This is a difficult one because the 12-volt battery is like a mainstay of the industry. It has been here for several decades, and so you have all the stuff that goes into the car, all the components inside of it have all been designed to work with a 12-volt for the most part. There’s niche products that exist in smaller volumes. Tesla, for example, with its newest Cybertruck, is building the vehicle on a 48-volt system. The amount of parts that are designed to work with 48 volts, it’s not significant. Hyundai is another automaker that’s starting to use more lithium ion 12-volt batteries, which are said to be more reliable according to some of the data that I reviewed. So those are some of the things that could be done, but the consensus I got from a lot of the folks that I talked to is the sort of traditional 12-volt battery is going to be here for some time.

Alex Ossola: That was our reporter Ryan Felton. Coming up, why the Nigerian government is blaming crypto for its currency crisis. That’s after the break.
Amid an unstable economic backdrop, many Nigerians have turned to cryptocurrency in recent years. The country has the second-highest adoption of crypto in the world after India, according to data provider, Chainalysis. Nigeria’s soaring inflation rate hit 30% in January. Now the Nigerian government is blaming Binance, the world’s biggest crypto exchange for crashing the currency. WSJ reporter Caitlin Ostroff joins me now with more.
Caitlin, Nigeria has faced many currency crises before. How has the introduction of crypto to the economy affected its national currency, the naira?

Caitlin Ostroff: For the last couple of years, it’s just served as this alternative type of currency. Some people do use Bitcoin for transactions within the country, even though we in some Western countries think of it as just buy this cryptocurrency through speculation. It does have some use as an actual payment in that economy. There’s been some concerns about people fleeing the local currency to crypto, but prior to this, there really hasn’t been a strong impact on the currency. And frankly, we still don’t know if that’s the cause of it.
There’s been a strong depreciation in the naira against the dollar this year, a drastic decline. It wouldn’t be a push to say that it’s near free fall. They’ve had currency crises before, but this one particularly seems extreme and the government has blamed crypto platforms for that. Crypto platforms say that they are just allowing people to buy and sell. They’re not deciding what the exchange rate is, whether that is the actual cause of the naira weakening, we don’t actually know. I mean, there’s high inflation. So there’s all of these other reasons that exist that people might not want to be holding the local currency.

Alex Ossola: What kinds of actions has the Nigerian government taken in the crypto space?

Caitlin Ostroff: In the past they’ve discussed banning it. More recently, they discussed essentially green lighting it, telling platforms to come and register. And then more recently around the time that the naira started to sharply weaken in February, the government directed the telecoms’ agency, which has the ability to say which websites can and cannot be viewed in a country to block all crypto exchange websites.

Alex Ossola: Let’s talk about Binance. What is the government’s beef with Binance?

Caitlin Ostroff: We spoke to currency traders at local banks in Nigeria who said that more and more they have seen people cite the rate on Binance for how many naira you get for a dollar or how many dollars you get for naira. And the government no longer officially pegs the naira to a certain level, but people within the country we’ve spoken to say that there’s been this unspoken rule of don’t let it sharply fall. And so there seem to still be the desire from the government, whether spoken about unspoken, that it not depreciate quickly. And so the rate on Binance and the rate on other websites that kind of showed this parallel black market rate still diverged from the official rate. And so it became this platform in which people were going, this is where I check to see how much the naira is really worth.

Alex Ossola: And what has Binance said about this?

Caitlin Ostroff: Binance has said that they are not setting the rate for the naira, they are a marketplace in which there are people who want to buy it and there are people who want to sell it. And price discovery means that somewhere in the middle they meet. And so that’s Binance argument that they’re not orchestrating what the price is. And also that if they see a strong divergence in what the price should be or anything that looks like market manipulation, they shut that down immediately. They do compliance checks for people when they come onto the platform in the first place. And so in their opinion, there’s no argument to them having set the currency at a certain level.

Alex Ossola: That brings us to the climax of this story. So in late February, two Binance employees visited Nigeria. They still haven’t come home. Tell me some of the background here. What’s going on?

Caitlin Ostroff: So from speaking to their families and other sources, the Nigerian government had invited finance officials to a series of meetings late last month. And the two representatives who went were the head of financial crime compliance and the manager for the African region. And they had two meetings on that Monday. One went reasonably well. The other felt a little more hostile is what they told their families later. And shortly after that, officials from the government showed up and said, “Please pack your things. We are taking you elsewhere.” And so they have been held at a guarded house for the last two weeks. One of the Nigerian courts did issue an order saying they could be held two weeks. And so it’s a little bit unclear what happens from here, whether a court says that they can hold them further, whether they get released, whether something else happens.

Alex Ossola: Have Nigerian authorities said why they’re detaining the men?

Caitlin Ostroff: No. We’ve reached out to the Nigerian government multiple times to try and get clarity as to what alleged investigation is happening, what alleged crimes the government is considering, if any. And we haven’t gotten a comment back from them.

Alex Ossola: We should note an advisor to the Nigerian president told the Journal that Binance was cooperating with authorities and compensation to Nigeria was being discussed. So Caitlin, looking ahead, what does the situation between Binance and the Nigerian government tell us about the future of cryptocurrency in Nigeria?

Caitlin Ostroff: It tells us that there’s this calculus that Nigerians and potentially people in other countries are trying to make of what is the actual desire of the government. They say that cryptocurrencies are going to be regulated and allowed. Two of these officials are detained. That’s injected a lot of confusion into the Nigerian population. And then on the side of crypto companies, we spoke to another crypto exchange that was like, “We didn’t have any trips for our staff to go to Nigeria planned in the near future anyways. But if anything ever was scheduled, it’s permanently canceled.” And so there’s a lot of concern now about just the safety of officials, employees, people who work in crypto within the country.

Alex Ossola: That was Journal reporter Caitlin Ostroff. And that’s it for Tech News Briefing. Today’s show was produced by Julie Chang, with supervising producer Katherine Milsop. I’m Alex Ossola for the Wall Street Journal. We’ll be back this afternoon with TNB Tech Minute. Thanks for listening.