Securities and Exchange Commission (SEC) of Nigeria has issued a warning to all Nigerians about the danger of investing their money into cryptocurrencies (digital currencies) such as Bitcoin according to a report in BuzzNigeria.
In a statement released by the SEC they highlight that the commission nor any other regulatory body recognizes or has authorized these digital currencies or the organizations and individuals who are promoting the use of these currencies.
The SEC stated that there is no protection available for users or investors in these virtual currencies from financial losses if the currencies had to fail or if the companies that have been promoting them go out of business as sated in Naija.
The commission has therefore stated that people should be weary of such websites as there are no guarantees or regulation in place to protect them or their investment and that their is a possibility that some of these sites may be outright fraudulent pyramid schemes.
Digital currencies use encryption techniques to regulate the generation of units of currency and verify the transfer of funds and so while operating independently of a central bank.
Although many people still do not understand digital currencies and how they work there has still been a steady growth in the use of such currencies. With so many success stories of people making money off Bitcoin, will the Nigerian public heed the SEC’s warning or will the digital currency trend continue?
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