SEC Warns Nigerian Investors of High Risk Involved in Investing in Meme Coin Linked to Davido

The Securities and Exchange Commission, Nigeria (SEC) has warned the general public that meme coins lack fundamental value and are purely speculative.

The Securities and Exchange Commission (SEC) has warned Nigerian investors against investing in a meme coin linked to Nigerian music star, Mr David Adeleke, also known as Davido, due to its high risk.

About two weeks ago, the singer promoted a digital coin, $Davido, which has since gained attention and attracted buyers.

On Friday, the apex capital market regulator included a disclaimer on its website, warning that investors were buying the token at their own risk.

“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 a.k.a. Davido,” the notice stated.

According to the regulator, 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,” it said.

SEC noted that Capital Market Operators are by the 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 offered through any capital market mechanism.

The Commission will continue to monitor developments within the ecosystem and will not relent in deploying its regulatory powers as and when required.

“The public is hereby advised that investing in a Meme coin known as $Davido allegedly linked to the popular Nigerian singer, David AdedejiAdeleke AKA Davido is highly risky.

“Individuals who patronize it do so at their peril,” the regulatory agency said in the notice on the regulatory website.

News source：https://www.kdj.com/cryptocurrencies-news/articles/warns-nigerian-investors-risk-involved-investing-meme-coin-linked-davido.html

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