Avoid Davido’s Meme Coins, SEC Warns Nigerians

The Securities and Exchange Commission has warned Nigerians against investing in Meme Coins, known as $Davido, allegedly linked to popular Nigerian singer, David Adeleke, known as Davido.

The Securities and Exchange Commission gave the advice in a statement on its website, which it issued on Friday.

SEC said it does not recognise $Davido as an investment product or investable asset class under its regulatory purview.

The regulator noted that, consequently, individuals who invest in it do so at their own risk.

It said: “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.

According to the SEC, meme coins are 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.

The commission listed such capital market products as shares, debentures, units of collective investment schemes, derivatives contracts, commodities or other kinds of financial instruments or investments.

The regulator added: “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.