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CBEX Ponzi scheme collapsed in April 2025, trapping thousands of Nigerian and Kenyan investors.
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EFCC crypto scam investigation is now in full swing, with global agencies like the FBI and Interpol involved.
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Exploiting economic hardships, an AI-powered trading scam Kenya narrative lured victims with unrealistic returns.
Cryptocurrency is among the most lucrative ventures today, possibly turning your $100 investments into $1000 or even $10,000.
Unfortunately, this also attracts bad actors like hackers, scammers, and corn artists, among many more.
The recent CBEX Ponzi scheme is no different, following a well-known pattern within the regions: promised yields offering 100% return in 30 days only to vanish when gains peaked.
Like many instances of Digita asset fraud, investors woke up to locked accounts, shuttered Telegram accounts and demanded $100-$200” Verification fees” to “recover funds.”
Without further ado, let’s dive into dissecting the trending CBEX Ponzi Scheme and highlight why you should stop falling for these scams; we should have learnt by now.
What’s Going On: Decoding the CBEX Ponzi scheme Collapse
Africa has recently experienced a burst of digital asset adoption and an AI wave, making it a prime target for unsuspecting victims.
CBEX took advantage of this hype, bursting on the scene in late 2024, eyeing prominent crypto-friendly regions: Nigeria and Kenya.
Its initial pitch was compelling, stringing the hearts of residents desperate for a stable financial lifeline.
“Double your money in a month through “proprietary” trading algorithms; we offer copy trading for cryptocurrency; you have nothing to lose and all to gain,” these were the whispers and loud posts all over social media.
Unfortunately, this digital asset fraud worked like a charm, luring many investors. When the platform hit an all-time high of deposits, it went silent, disabling withdrawals on April 14th 2025. The CBEX Ponzi scam hit an all-time high.
Anatomy of the digital asset fraud
The CBEX Ponzi Scheme utilized new deposits to pay “returns” to earlier users—a defining trait of many of its kind.
However, the scheme took it a notch higher and disguised this method as well-known copy trading.
CHECK OUT: Pulse of Progress: Navigate Nigeria’s Crypto Dawn with Tactile Clarity and Bold Vision.
The notion of copy trading requires a trusted entity to send out signals that are applicable to standard trading platforms. CBEX created the illusion of copy trading by giving out timely codes that were applied to their applications.
Unfortunately, this would have immediately raised a red flag to a standard crypto trader since the codes sent didn’t reflect any known signal. When asked what cryptocurrency they traded in, vague answers were given.
Even our UX teams immediately flagged the operations, saying they mirror classic token-trading deceptions from past cycles, just dressed up in blockchain buzzwords.
Spotlight on Kenya: A Kenyan Crypto Scam Unfolds
Local Testimonies and Triggers
Awuor (not her real name), a finance professional in Nairobi, invested over KSh 1 million after seeing friends earn up to KSh 30 million monthly. “I was told the algorithm was AI-driven utilizing something called copy trading,” she shared, tears in her voice.
CBEX leveraged AI-powered trading scam Kenya tactics—claiming machine-learning bots could outsmart markets—to build credibility.
BEX Ponzi scheme collapse underscores the critical need for rigorous due diligence and red-flag recognition.[Photo: Youtube]
Early adopters have noted that it’s rarely a good sign when telegram groups vanish overnight. This Kenyan crypto scam had rippling effects, especially with the region adopting a VASP framework.
Behind the Headlines: Broader Implications for African Web3
Trust Erosion & Regulatory Wake-Up Calls
The recurring theme of CBEX investors being unable to withdraw funds is a common problem in African fraud cases. Regions like South Africa, which once had the highest rate of digital asset fraud rates, had to hasten their crypto regulatory framework to quell growing concerns.
Trust is fragile, and once broken, it creates an atmosphere that goes against adoption. Cryptocurrency is a means of wealth generation, but it requires understanding the market and knowing which coins are favourable and which are not.
Unfortunately, many bad actors take advantage of the lack of educated persons within Africa seeking passive income and have neutral or lack regulatory rules.
Opportunity for Leadership
Despite setbacks, Africa’s emerging markets can pioneer transparent, community-driven protocols. By developing strict regulations that hold providers and businesses accountable for customer funding, many nations can prevent a scenario like the CBEX Ponzi Scheme.
Furthermore, encouraging community-driven protocols brings profits closer to home, allowing many to benefit from local talents and gurus within the crypto space.
The EFCC Response: Tracking the Investigation
Nigeria’s Economic and Financial Crimes Commission has launched an EFCC crypto scam investigation, collaborating with the FBI, Interpol, and other international bodies.
Drawing on past successes in digital crime probes, the EFCC has secured preliminary warrants and begun asset tracing across borders. Transparency advocates hope this sets a precedent for swift cross-jurisdictional action.
Heightened enforcement raises the bar for due diligence on exchange platforms. Anyone seeking to invest in African crypto projects must now vet licensing, verify audit reports, and confirm adherence to AML/KYC protocols. Based on analyzing 60+ campaigns, we recommend checking for third-party security assessments before committing funds.
Red Flags & Warning Signs: Defending Against Sophisticated Trading Frauds
Spotting a Fraud Before It’s Too Late
- Unrealistic returns without verifiable track records.
- Hidden or shifting fee schedules are buried in fine print.
- Closed or unresponsive community channels (e.g., Telegram, Discord).
Case study: CBEX’s abrupt Telegram closure was a telltale sign long before withdrawals halted.
Risk Mitigation Strategies
- Verify platform licensing with local regulators.
- Use multi-sig wallets and limit exposure per platform.
- Diversify holdings across reputable, African-led DeFi protocols.
Investor Impact: CBEX investors unable to withdraw funds
Quantifying the Loss
Preliminary estimates suggest that around $50 million was lost, which was split roughly 60/40 between Nigeria and Kenya. Families and small businesses—once buoyed by mobile earnings—now face severe liquidity crunches. Anecdotal reports include stalled school fees, halted medical treatments, and frozen business expansions.
Recovery Hopes and Realities
Full restitution remains unlikely. “Verification fees” and the platform’s operators typically vanish into thin air. In my experience advising victims, community-led fundraisers and pro bono legal clinics provide the only real hope of partial relief.
Taking Action: How to Report the Scam
To Report CBEX fraud to EFCC, gather your documentation—transaction records, chat logs, fee receipts—and submit them via the EFCC online portal or at your nearest local office.
You can also call the EFCC hotline or email their cybercrime desk. Early reports can strengthen the investigative mandate and accelerate asset recovery efforts.
Community Advocacy
Partner with blockchain associations and legal aid groups to amplify victim voices. Social media campaigns, petitions, and open letters can pressure authorities into swift action. After launching similar campaigns for past scams, I’ve seen how grassroots pressure compels faster responses.
CHECK OUT: What African Developers Must Understand About AI Crypto Token Opportunities.
Turning Crisis into Opportunity: Safe Web3 Participation
The collapse of the CBEX Ponzi scheme underscores both the promise and peril of rapid crypto adoption in Africa. Despite the sour taste it has left to many investors, this is an opportunity for you to take time and educate yourself on what is genuine and what is fake.
Our academy section has educational content that can provide better insights into understanding how to vet DeFi projects. In addition, it allows you to take communities to hunt down similar organizations that highlight various similarities with CBEX cre, creating a protective barrier even for others.
Learning from this is the first step; making the necessary changes is the next, and ensuring no other faces the same tragedy is the final step.
