Nigerian SEC warns against investments in memcoin linked to Davido
Date: 2024-06-17 Author: Oliver Abernathy Categories: CRYPTO PAYMENTS
The Nigerian Securities and Exchange Commission (SEC) has expressed caution regarding investments in the memcoin associated with Nigerian superstar Davido, as after the singer's endorsement of the token, its value skyrocketed and then fell sharply, leading to significant financial losses for investors. According to the SEC, memcoins are not registered financial products and are not subject to legal protection in the event of losses.
Details of the incident
Nigeria's SEC has reported waves of investment interest in memcoin, inspired by the popularity of Davido. The singer supported the token, which acted as a catalyst for its value to rise, but investment expectations were disappointed on the same day when the price of memcoin plummeted. Investors who trusted the celebrity's choice were left with losses exceeding $450,000.
Nigeria SEC Position
The SEC emphasized that memcoins are joke digital assets that are not financial instruments. They are not subject to the legal regulation of shares, bonds or other financial products and cannot be used to purchase goods and services. The Commission urged investors to exercise caution and awareness when considering investments in such tokens, especially when they receive the support of famous individuals.
Davido followers who felt the negative effects of their investments in memcoin expressed disappointment in the singer for his recommendation of the token. The SEC continues to monitor the situation and is taking steps to ensure that investors are aware of the risks associated with such speculative assets.
