In the wake of the CBEX scandal that swindled trillions of naira from unsuspecting Nigerians, concerns are mounting that another Ponzi scheme may be unfolding, this time under the guise of a meme coin known as Punisher Coin ($PUN).
- The SEC has issued a formal warning against investing in an unregulated cryptocurrency named Punisher Coin ($PUN), citing potential risks.
- $PUN has been described as a ‘meme coin,’ largely dependent on internet hype without intrinsic value.
- Concerns have arisen as $PUN exhibits hallmarks of a Ponzi scheme, including lack of authorization in Nigeria’s financial ecosystem.
The Securities and Exchange Commission (SEC) issued a warning to Nigerians on Sunday against investing in $PUN and characterizing the ongoing presale as both unlawful and unregulated.
The commission noted that the initiative exhibits the characteristics of a Ponzi scheme, with no clearance or monitoring from Nigeria’s capital market regulators.
According to the SEC, the $PUN promoters are not authorized to operate in any manner within Nigeria’s financial system.
“Our attention has been drawn to online promotions of an unauthorised presale for a cryptocurrency called PUNISHER COIN, also known as $PUN,” the commission warned via a statement.
As seen in the Punch newspaper, the Commission noted that early investigations have found that $PUN belongs to the category of “meme coins,” which are digital assets that often lack real-world application or inherent value.
The SEC warned that meme currencies draw their value primarily from the excitement produced by promoters or online groups, making them especially vulnerable to pump-and-dump operations.
“Punisher Coin, or $PUN, is a meme coin. Meme coins generally have no use case, intrinsic value, or tangible projects backing them,” the statement further read.
“Any attributed value is usually linked to its promoters or community hype, which often leads to fraudulent pump-and-dump schemes.”
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Anyone who decides to invest in the unregistered $PUN currency does so at their own risk, the Commission emphasized.
This warning comes just months after the CBEX scandal, where thousands of Nigerians were lured into investing in what turned out to be a fraudulent crypto scheme promising unrealistically high returns.
CBEX
CBEX, a platform claiming to be the China Beijing Equity Exchange, crashed in Nigeria, leaving an estimated 300,000 investors with losses of about ₦1.3 trillion (roughly $840 million).
Investigations indicated that this was a Ponzi fraud, and the real amount lost might be substantially less, approximately $6.1 million.
This warning comes just months after the CBEX scandal, where thousands of Nigerians were lured into investing in what turned out to be a fraudulent crypto scheme promising unrealistically high returns.
Several new users joined in the days leading up to CBEX’s suspension, believing the platform’s malfunction was simply a temporary security issue that would be resolved in a few days.
The site sent a message to its members right before locking them out, saying, “All accounts must go through the following verification processes to guarantee their legitimacy.
Accounts with balances less than $1,000 before any losses require a $100 deposit. Accounts with funds over $1,000 demand a $200 deposit.
