The collapse of the so-called Crypto Business Exchange (CBEX) has once again laid bare a painful truth: the dream of sudden wealth continues to lure countless Nigerians into financial ruin. In the aftermath of one of the largest Ponzi schemes in the nation’s history, the shattered hopes and emptied bank accounts of over half a million victims serve as a stark warning – one that, tragically, goes unheeded time and again. Despite the lessons of the past, the promise of effortless riches remains an irresistible siren song, drawing in new victims with every cycle of fraud.
CBEX (Crypto Business Exchange) was a major Ponzi scheme that ran in Nigeria for barely a year – 2024 to early 2025 – but is reported to have resulted in losses by more than 600,000 Nigerians, up to the tune of more than N1.3 trillion (about $800m), making it one of the largest financial frauds in Nigeria’s history. CBEX claimed to be an AI-powered crypto trading platform offering 100 percent return on investment in one month, with daily returns of 3.5 percent.
Last month, in the usual classic Ponzi style, CBEX abruptly disabled withdrawals, citing a “security breach.” Then it asked users to pay additional verification fees of $100–$200 to access their funds — a typical move in exit scams. The scheme finally collapsed.
The EFCC and INTERPOL are said to have launched investigations into the scam, but we are yet to hear about what will be done to console victims of the fraud.
Read also: The Ponzi pandemic: How schemes like CBEX are undermining Nigeria’s financial system
The mechanics are simple but devastating: with little or no risk, luring investors in with promises of high, guaranteed returns, the illusion of profitability is maintained as long as new money keeps flowing in. But when withdrawals outpace new deposits, or when the operators decide to disappear, the entire structure collapses – leaving devastation in its wake.
At its core, a Ponzi is an investment fraud where returns to earlier investors are made using money from new investors, rather than from legitimate business earnings or profits. There have been many Ponzis in the past – not only in Nigeria. After all, Ponzi is not a Nigerian name. The scheme is named after Charles Ponzi, who operated a similar scheme in the early 20th Century.
Charles Ponzi, an Italian-born swindler, gave his name to the infamous “Ponzi scheme,” a type of fraud that pays investors with money from newer investors rather than actual profits. In the early 1920s, Ponzi promised high returns by exploiting international reply coupon (IRC) price differences, but most funds went to earlier investors and himself. At its peak, he made huge sums in months before his scheme collapsed under journalistic and regulatory scrutiny, leading to his imprisonment and exile.
Ponzi schemes have plagued Nigeria for years, with notorious examples like Planwell, Money Tree, and MMM Nigeria (2016–2017), as well as MBA Forex and Capital Investment Ltd. These scams have caused significant financial losses for countless Nigerians and their families.
Why do people always get caught in these financial scams? Greed and lack of values have always been the underlying factors to the success of Ponzi anywhere. Some people have blamed poverty or government policies; other people have attributed attraction of Ponzi to hard times along with unemployment high and inflation rising.
CBEX’s spectacular implosion is just the latest chapter in a long-running saga. The names and faces may change, but the underlying psychology remains the same. For many, the hope of a financial breakthrough – especially in a climate of economic hardship – overrides caution and scepticism. The emotional pull of these schemes is powerful: stories of friends, neighbours, even religious leaders who “cashed out” early become proof that the system works, blurring the line between fact and fantasy.
Yet, the cost is always borne by the most vulnerable. The aftermath is more than just numbers on a balance sheet; it is the erosion of trust, the deepening of despair, and the perpetuation of a cycle that preys on hope itself. For every CBEX, there are countless smaller schemes operating in the shadows, ready to pounce on the next wave of unsuspecting victims.
What makes these scams so persistent is partly due to regulatory gaps and slow enforcement that allow fraudsters to operate with impunity. However, the deeper issue is societal: a culture that too often celebrates sudden wealth without questioning its origins, and a lack of widespread financial literacy that leaves many ill-equipped to recognise red flags.
The CBEX debacle is not merely a cautionary tale – it is a clarion call for greater financial vigilance, regulatory oversight, and public education. As long as hope outpaces scepticism and desperation eclipses due diligence, the cycle of exploitation will persist. Breaking free from this pattern demands not only stronger laws and enforcement, but a collective commitment to fostering a culture where financial prudence is valued over the mirage of quick riches. Only then can we hope to shield future generations from the devastating fallout of the next Ponzi scheme.
