The SEC has declared CBEX, a Nigerian digital asset trading platform, illegal for operating without registration. This statement follows user complaints about withdrawal issues, hinting at possible Ponzi scheme activity. While some users still believe in the platform’s functionality, the SEC confirms it is unregistered. SEC Director General Emomotimi Agama emphasized the need for caution in using unregistered platforms during a recent virtual engagement. With the newly signed Investment and Securities Act (ISA 2025), the SEC can prosecute Ponzi scheme operators, imposing severe penalties and fostering investor confidence in Nigeria’s market.
The Securities and Exchange Commission (SEC) has responded to the operations of CBEX, a digital asset trading platform in Nigeria, stating that any such platform not registered with the SEC is deemed illegal.
This announcement follows recent rumors about the potential closure of these platforms due to users being unable to withdraw their funds over the weekend.
During a virtual discussion with fintech stakeholders on the Investment and Securities Act (ISA 2025) on Monday, SEC Director General Emomotimi Agama cautioned Nigerians against engaging with unregistered platforms.
“Recently, a post went viral regarding a specific platform and its activities, leading to further reports of its closure and related issues.
“I was even tagged in one of those messages. Let me make it abundantly clear: If it is not registered, it is illegal,” Agama asserted, without directly naming the platform.
Concerns regarding CBEX
Social media was abuzz on Friday with worries about CBEX, as multiple users cautioned that the platform exhibits signs of being a Ponzi scheme.
- The concerns arose from several users’ inability to make withdrawals, stirring fears that the scheme might have collapsed.
- Nonetheless, some users maintain that the platform remains operational, although withdrawal capabilities are currently restricted due to the platform’s regulations.
- CBEX advertises itself as an investment platform that offers users a 100% return on investment within a month, only accepting investments in USD. Users also earn bonuses for referrals.
- Meanwhile, checks by Nairametrics in the SEC’s database reveal that CBEX is not registered with the Commission.
Crackdown on illicit operations
Discussing the provisions of the Investment and Securities Act (ISA 2025) recently signed by President Bola Tinubu, the SEC DG indicated that the Act establishes clear rules and regulations for digital asset platforms, including mandates for registration to foster transparency and confidence.
This, the SEC noted, enables them to address illicit activities, such as Ponzi schemes, pump and dump tokens, and unregistered exchanges, promoting a safer investment climate.
“It is essential that even celebrities exercise caution in their actions. Becoming influencers or promoting meme coins, which do not benefit the general populace, will not be tolerated,” he cautioned.
Key points to understand
Nairametrics previously reported that the SEC has been empowered through the ISA 2025 to take legal action against promoters of Ponzi schemes in the nation.
During a recent television interview, the SEC DG emphasized that before the implementation of the new law, the Commission lacked the legal authority to prosecute Ponzi scheme operators, which complicated efforts to bring them to justice.
- As a result, Agama noted that individuals operating Ponzi schemes in Nigeria can now face up to 10 years in prison and a penalty of N40 million if apprehended.
- He remarked that with the new law, the Commission has the necessary tools to combat unscrupulous operators and provide relief to Nigerians.
- This will also enable the Commission to eliminate the “bad actors” and ensure that people feel more confident and positive about investing in the Nigerian market, “fully aware that the investor protection mandate of the SEC has now been significantly strengthened.”
