CBEX Controversy Rocks Nigeria: Ponzi Scheme Allegations, Withdrawal Woes, and SEC Warnings

LAGOS, NIGERIA – The digital asset trading platform CBEX has ignited a firestorm of debate across Nigeria, trending heavily on social media platforms like X as users clash over its legitimacy.

Once hailed as a lucrative opportunity promising 100% returns in just 30 days, CBEX now faces serious accusations of operating as a Ponzi scheme, with halted withdrawals and regulatory warnings from Nigeria’s Securities and Exchange Commission (SEC) fueling widespread concern.

As Nigerians grapple with fears of financial loss, the saga underscores the risks of unregulated digital investment platforms in a country hungry for economic opportunity.

A Platform Under Scrutiny

CBEX, which markets itself as a cryptocurrency trading platform leveraging artificial intelligence (AI) to deliver consistent profits, gained traction in Nigeria in late 2024.

The platform’s promise of doubling investments in a month, coupled with a referral-based bonus system, drew thousands of users, particularly in a nation where economic challenges make high-return opportunities appealing.

Investments are accepted exclusively in USD, and CBEX’s sleek website, resembling established exchanges, lent it an air of credibility.

However, skepticism began to mount as early as February 2025, when online forums like Nairaland raised red flags about CBEX’s similarities to historical Ponzi schemes like MMM, which collapsed in 2016, leaving millions of Nigerians in financial ruin.

By April, the platform’s operations came under intense scrutiny following reports of withdrawal restrictions, sparking panic among users with funds locked in the system.

Withdrawal Delays Spark Panic

The controversy erupted into public view on April 9, 2025, when CBEX restricted withdrawals, citing a “security breach” and promising resolution by April 15. Social media platforms, particularly X, became battlegrounds for heated debates. Some users, like @BlessedAjoke

, defended CBEX, insisting the pause was temporary and urging others not to spread “fake news.”

Others, including influential X user @Letter_to_Jack, sounded alarms after learning of an individual who turned a $1,000 investment into $5,000—a return he labeled a hallmark of a Ponzi scheme. “The crash is imminent,” he warned, advising users to withdraw funds immediately.

Reports of accounts showing zero balances and demands for additional deposits to “verify” accounts further eroded trust. One user, @Ndfrek, posted on April 11: “The first step a Ponzi scheme takes before its inevitable crash is to restrict withdrawals.” By April 12, allegations surfaced that CBEX’s offices in Nigeria were looted as frustrated investors took to the streets, though these claims remain unverified.

SEC Sounds the Alarm

The Nigerian SEC has taken a firm stance against CBEX, emphasizing that the platform is not registered and thus operates illegally under the newly enacted Investments and Securities Act (ISA) 2025.

On April 14, the SEC reiterated that unregistered digital asset platforms violate the law, with Director General Dr. Emomotimi Agama warning that Ponzi scheme operators now face up to 10 years in prison and fines of N20 million or more. “We welcome innovation, but it must occur within a regulated environment that protects investors,” Agama stated.

The SEC’s warnings align with international concerns. In April 2024, Hong Kong’s Securities and Futures Commission (SFC) flagged CBEX Group as a suspicious virtual asset trading platform, citing potential fraud and unauthorized withdrawals.

The absence of verifiable regulatory approval in Nigeria, coupled with CBEX’s opaque ownership structure—linked loosely to Belize but lacking clear documentation—has deepened suspicions.

Divided Voices: Defenders vs. Skeptics

Despite the mounting allegations, CBEX retains a loyal base of supporters. Some users report successful early withdrawals, with Trustpilot reviews praising the platform’s “hassle-free payouts” and charitable contributions.

“I joined CBEX one month ago and have already done my first withdrawal smoothly,” one reviewer claimed. However, critics argue these payouts are typical of Ponzi schemes, designed to build trust and attract new investors whose funds are used to pay earlier participants.

Financial experts have weighed in, highlighting regulatory gaps in Nigeria’s digital asset space. Aliyu Ilias, a financial analyst, called for stronger oversight from the Central Bank of Nigeria (CBN) and the National Information Technology Development Agency (NITDA) to curb dubious platforms.

“Nigerians should be cautious of quick-income platforms that could crash at any point,” he advised. Cryptocurrency expert Kayode Olagunju expressed frustration, noting that education campaigns have failed to deter Nigerians from falling for schemes promising unrealistic returns. 

A Familiar Pattern

CBEX’s trajectory bears striking similarities to past Nigerian Ponzi schemes. MMM, which promised 30% monthly returns, collapsed spectacularly, wiping out billions of naira.

More recent scams like Racksterli and Loom followed a similar playbook: enticing promises, early payouts, and eventual crashes.

CBEX’s 40-45 day lock-in period, 20% early withdrawal penalty, and lack of transparency about its AI-driven trading model echo these predecessors, raising fears of another financial disaster.

Estimates of funds trapped in CBEX vary, with some X users claiming losses in the hundreds of thousands of dollars, potentially totaling trillions of naira. As of April 15, reports indicate that withdrawals have resumed for some users, but many remain locked out, and skepticism persists. “CBEX finally closed with over $833M,” posted @igbomalam, though this figure is unconfirmed.

What’s Next for CBEX and Nigerian Investors?

As the April 15 deadline passes, CBEX’s fate hangs in the balance. The platform’s official X account, @cbextrades, has maintained an optimistic tone, denying collapse rumors and promising updates.

“CBEX can never crash at all. We will forever stand strong,” one post read. Yet, with regulatory pressure mounting and user trust eroding, the platform faces an uphill battle to restore confidence.

For Nigerian investors, the CBEX saga serves as a stark reminder of the risks inherent in unregulated digital platforms. The SEC’s crackdown, empowered by ISA 2025, signals a tougher stance on Ponzi schemes, but enforcement remains a challenge in a rapidly evolving crypto landscape.

Experts urge Nigerians to prioritize due diligence, verify regulatory compliance, and avoid schemes promising guaranteed profits.

“This controversy has sparked a conversation we desperately need,” noted a Pulse Nigeria report. Whether CBEX proves legitimate or joins the ranks of Nigeria’s infamous Ponzi schemes, its impact on public trust and financial literacy will linger.