Regulators warn Nigerians against investing in Davido's crypto token, $Davido

The Nigerian government has warned Nigerians against investing in the crypto token of music star, Davido.

Nigerian regulators have warned the public against investing in the crypto token of music star, Davido.

Last month, Davido announced the launch of the crypto token or memecoin inspired by himself.

The digital currency, known as “Timeless Davido” ($DAVIDO), sparked excitement among the singer’s fans and supporters.

Davido worked with the main blockchain platforms Phantom and Solana to complete the proposal.

Initially, $DAVIDO skyrocketed, hitting a market cap of $10 million in four hours and gaining momentum on DEX Screener.

The jubilation was however short-lived, as the coin’s value dropped on Thursday.

Over 80% of that value was wiped out with the coin’s market capitalization dropping to $2.1 million amidst a massive selloff by Davido’s piled-up social media followers.

Dailycoin, a crypto data outlet, said Davido himself extracted a sum of whooping $474,000 from the token before cutting ties.

Prominent voices in the cryptocurrency space took to social media to assert that $Davido was a “Crypto Scam” from the very start.

Justin Gallum, a cryptocurrency analyst did not mince words in stating that Davido should be put in jail.

“If you bought the $DAVIDO meme coin expecting to cash out profits, in here to tell you that you were outright scammed by Davido himself. This is textbook behaviour for a crypto rug pull scam,” said Rume, an analyst on Channel TV and other media platforms.

Many blamed Davido for causing their loss because he withdrew a significant amount of his initial investment, causing a crash and making a huge profit for himself.

Hours after being called out by a significant number of disgruntled X users, the former DMW head welcomed everyone who joined the $Davido community early on.

He further said that some people were fortunate enough to win $100 via the Solana platform.

But in a statement on Friday, Securities and Exchange Commission (SEC) warned the public that investing in the meme coin is highly risky.

The commission pointed out that it does not recognize $Davido as an investment product or investable asset class under its regulatory purview.

“The attention of the Securities and Exchange Commission, Nigeria (“SEC”) has been drawn to a meme coin known as “$Davido” allegedly linked to the popular Nigerian singer, David Adedeji Adeleke AKA Davido.”

“Generally, meme coins are cryptocurrencies inspired by memes and internet jokes. They are often envisaged as a fun, light-hearted cryptocurrencies promoted through a social media community and sometimes through celebrity endorsements.

“Meme coins are also NOT intended to serve as a medium of exchange accepted by the public as payment for goods and services, or as digital representation of capital market products such as shares, debentures, units of collective investment schemes, derivatives contracts, commodities or other kinds of financial instruments or investments.

“The general public is HEREBY ADVISED that meme coins lack fundamental value and are purely speculative. The general public is further WARNED that investing in meme coins, including $Davido, is highly risky and should be done with a full understanding of the associated risk.

“Capital Market Operators are by this Notice 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.

“PLEASE NOTE that the Commission does not recognize $Davido as an investment product or investable asset class under its regulatory purview, as such individuals who patronize it, do so at their peril. The Commission will continue to monitor developments within the ecosystem and will not relent in deploying its regulatory powers as and when required.”

News source：https://www.kdj.com/cryptocurrencies-news/articles/regulators-warn-nigerians-investing-davido-crypto-token-davido.html

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