SEC Warns Public Against Investing in Meme Coins Like $davido Linked to Davido

The Securities and Exchange Commission (SEC) has warned that investing in meme coins, including $davido, is highly risky and should be done with a full understanding of the associated risks.

The Securities and Exchange Commission (SEC) has warned Nigerians against investing in meme coins, including $davido, without fully understanding the associated risks.

The commission, in a circular on June 14, said its attention had been drawn to a meme coin known as “$davido” that is allegedly linked to the popular Nigerian singer, Davido.

According to the circular, meme coins are typically cryptocurrencies inspired by memes and internet jokes, and are often promoted as fun and light-hearted cryptocurrencies through a social media community and sometimes through celebrity endorsements.

The SEC further stated that meme coins are not intended to serve as a medium of exchange that is accepted by the public as payment for goods and services, or as a digital representation of capital market products such as shares, debentures, units of collective investment schemes, derivatives contracts, commodities or other types of financial instruments or investments.

The commission noted that meme coins lack fundamental value and are purely speculative, adding that capital market operators are warned not to associate with instruments that fall outside the SEC’s regulatory purview.

“Such instruments should not in any manner be distributed or monitored through any capital market mechanism,” the SEC stated.

It also emphasized that the commission does not recognize $davido as an investment product or investable asset class under its regulatory purview, and that individuals who patronize it do so at their own risk.

News source：https://www.kdj.com/cryptocurrencies-news/articles/warns-public-investing-meme-coins-davido-linked-davido.html

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