Entertainment
Investing in Davido’s meme coin is highly risky, SEC warns
The Securities and Exchange Commission (SEC) has warned the
public that “investing in Davido‘s meme coin is highly risky”.
A fortnight ago, the ‘Unavailable’ hitmaker launched
$Davido, his new cryptocurrency coin in a partnership involving Phantom and
Solana.
The coin quickly gained popularity and even earned profits
for early investors.
However, it crashed shortly after with many people who
invested in it reporting losses. Some social media users also called out the
singer for an alleged scam.
Reacting to the development in a
In the statement shared on Friday, SEC also warned that
“The attention of the Securities and Exchange Commission,
“Generally, meme
“Meme coins are also NOT intended to serve as a medium of
“The general public is HEREBY ADVISED that meme coins lack
“Capital Market Operators are by this Notice warned not to
“PLEASE NOTE that the
“The Commission will continue to monitor developments within
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statement, the commission
disclosed that it does not recognize $Davido as an investment product or
investable asset class under its regulatory purview.
anyone who “patronizes the meme coin, do so at their peril”.
Nigeria (“SEC”) has been drawn to a meme coin known as “$Davido” allegedly
linked to the popular Nigerian singer, David Adedeji Adeleke AKA Davido,” the
statement reads.
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.
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.
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.
associate with instruments that fall outside the SEC’s regulatory purview. Such
instruments should not in any manner be distributed or monitored through any
capital market mechanism.
Commission does not recognize $Davido as an investment product or investable
asset class under its regulatory purview, as such individuals who patronize it,
do so at their peril.
the ecosystem and will not relent in deploying its regulatory powers as and
when required.”
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