Nigerian Regulator Issues Warning Against Cryptocurrency Investments

The agency had been alarmed by “the rate at which Nigerians sent them petitions on fraudulent investments.”

Nigeria’s Economic and Financial Crimes Commission (EFCC) has issued a warning to the country’s citizens over cryptocurrency investments. The warning comes few weeks after Bitcoin hit an all-time high of over $64000 before plummeting to around just over $50,000. Bitcoin is currently trading at ~$54,200, data from Coindesk shows, down about 16% from the ATH.

Since Bitcoin hit an all-time high, it has caught the attention of many. Many wish to enjoy the benefits of Bitcoin’s rally and are thinking whether it’s too late to jump on the craze or maybe it’s just too late to get rich quick.

But before you go ahead to click the buy button, the law enforcement agency has a message. The agency warns budding crypto investors to beware of the risks associated with digital assets like Bitcoin.

EFCC said Nigerians are losing money to fraudulent investment schemes. It said citizens are majorly losing money to Bitcoin trading, forex, and Ponzi schemes.

“Investment in Bitcoin is a high-risk activity as the terrain is largely unregulated, and prone to fraud,” an agency spokesman Wilson Uwujaren said(via Business Insider).

The spokesman said the agency had been alarmed by “the rate at which Nigerians sent them petitions on fraudulent investments.” He spoke of a typical trick investment scams use to attract novice investors: a promise of high returns with less risk.

Investment scams continue to thrive in the country, Owujaren said, despite several warnings from the commission and other stakeholders.

Nigerian crypto community is the most vibrant across Africa with the highest P2P Bitcoin trading volume. In the January to March period, the value of P2P Bitcoin trading value stood at $99.1 million.

Such high volumes indicate the readiness of Nigerians in investing and trading cryptocurrencies. This led the country’s Central Bank to warn citizens of the risk of dealing with crypto.

Back in February, the Central Bank of Nigeria sent a reminder to financial institutions to abide by the 2017 circular that prohibits dealing in cryptocurrencies or facilitating payments for cryptocurrency exchanges.

A strong statement also accompanied the warning on the country’s stance on crypto: it has no place “at this time” in its financial system. But cryptocurrencies are not banned in the country yet.

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Alvin Wanjala

Alvin Wanjala has been writing about technology for over 2 years. He writes about different topics in the consumer tech space. He loves streaming music, programming, and gaming during downtimes.

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