CBEX Collapse Triggers Urgent Calls for Stronger Regulation of Digital Asset Trading in Nigeria
The collapse of the CBEX digital asset trading platform has sparked widespread calls for more stringent government regulation of digital asset markets in Nigeria. Following its sudden failure, which left investors unable to access their funds, losses have surpassed N2.4 billion. The incident has raised critical questions regarding the effectiveness of Nigeria’s regulatory framework in overseeing digital investments.
Concerns about CBEX began when users reported problems withdrawing their funds on social media, and by the following Monday, the platform had completely shut down, wiping out users’ account balances. The platform, which lacked an official social media presence, initially presented itself as a high-yield investment option, but its collapse left investors in financial distress. To add insult to injury, CBEX allegedly locked its Telegram channels and introduced “verification fees” of up to $200 for users to access their funds, which further aggravated the situation.
Experts have pointed out that the lack of regulation contributed significantly to the crisis. Dr. David Udoh, a medical practitioner, criticized the platform for operating without registration from the Nigerian Securities and Exchange Commission (SEC). He explained that financial illiteracy, widespread economic hardship, and the desperation for quick financial gains led many Nigerians to invest in such unregulated platforms, unaware of the risks involved. Dr. Udoh emphasized that weak regulation and inadequate enforcement allowed platforms like CBEX to operate freely, causing harm to investors.
The CBEX disaster has prompted calls for swift regulatory action. SEC Director General Emomotimi Agama warned against investing in unregistered platforms, reiterating that such entities are illegal in Nigeria. Both Dr. Udoh and other experts are urging regulatory agencies to adopt a more proactive stance in monitoring and shutting down unregistered platforms to protect investors and prevent further financial losses.
Source: Naira metrics