Crypto Bridge Exchange (CBEX) Resumes Operations Amid Controversy and Ongoing Investigations
In a surprising development, Crypto Bridge Exchange (CBEX), a cryptocurrency platform previously accused of defrauding over 600,000 Nigerians of approximately ₦1.2 trillion, has reportedly resumed operations. The move comes despite an ongoing investigation by the Economic and Financial Crimes Commission (EFCC) and a ban by the Securities and Exchange Commission (SEC), raising serious concerns about the platform’s legitimacy and the safety of investor funds. While CBEX has reintroduced services for new users, allowing them to register, trade, and withdraw funds, previous investors remain locked out of their accounts, with access contingent on a controversial compensation scheme.
Background: CBEX’s Collapse and Allegations of Fraud
CBEX made headlines in April 2025 when its operations abruptly halted, leaving thousands of investors unable to access their funds. The platform, which had promised high returns through cryptocurrency trading and investment schemes, was accused of operating a Ponzi scheme that defrauded Nigerians of an estimated ₦1.2 trillion (approximately $750 million USD at current exchange rates). The collapse sparked widespread outrage, with affected investors staging protests and demanding accountability.
The EFCC swiftly launched an investigation, freezing over 1,000 accounts linked to CBEX and its operators. The SEC, Nigeria’s primary financial regulator, declared CBEX an unregistered and illegal operation, issuing a ban on its activities. Authorities alleged that the platform lured investors with promises of guaranteed profits, only to siphon funds into offshore accounts. The fallout was devastating, with many Nigerians losing their life savings, exacerbating economic hardship in a country already grappling with inflation and currency devaluation.
CBEX’s Quiet Return
Despite the ban and ongoing investigations, CBEX has reportedly resumed operations, according to sources familiar with the matter. The platform has quietly reactivated its website and services, allowing new users to register accounts, trade cryptocurrencies, and withdraw funds. However, existing investors—those who lost funds during the April collapse—are still unable to access their accounts. CBEX has stated that these accounts remain frozen pending the completion of an external audit by a UK-based insurance firm, the details of which have not been publicly disclosed.
The resumption of operations has raised eyebrows, particularly given the SEC’s explicit ban and the EFCC’s ongoing probe. Critics argue that CBEX’s ability to restart services suggests regulatory loopholes or inadequate enforcement, potentially exposing new investors to significant risks. The platform’s lack of registration with the SEC further underscores its questionable legal standing, as unregistered entities are not subject to the same oversight and investor protections as licensed financial institutions.
Controversial Compensation Scheme
One of the most contentious aspects of CBEX’s return is its proposed compensation scheme for previous investors. According to reports, the platform is requiring affected users to “reinject” funds—essentially deposit new money—into their accounts to restore access and recover a portion of their lost investments. This requirement has been met with fierce criticism, with many labeling it a predatory tactic designed to extract additional funds from already victimized investors.
Financial experts have warned that such a scheme bears the hallmarks of a classic Ponzi structure, where new investments are used to pay returns to earlier investors, creating the illusion of profitability. “This is a red flag,” said Dr. Chidi Okonkwo, a Lagos-based financial analyst. “No legitimate platform would require victims of a collapse to pay more money to recover their losses. Investors should proceed with extreme caution.”
CBEX has defended the reinjection requirement, claiming it is necessary to stabilize the platform and ensure long-term sustainability. However, the lack of transparency regarding the audit process, the identity of the UK-based insurance firm, and the platform’s financial health has done little to inspire confidence.
Regulatory and Legal Implications
The resumption of CBEX’s operations has reignited debates about the regulation of cryptocurrency platforms in Nigeria. The country has seen a surge in crypto adoption in recent years, driven by economic instability and a lack of trust in traditional financial systems. However, the absence of robust regulatory frameworks has left investors vulnerable to scams and fraudulent schemes.
The SEC has reiterated that CBEX is not registered and is operating illegally, urging Nigerians to avoid engaging with the platform. The EFCC, meanwhile, has vowed to continue its investigation, with sources indicating that arrests of key CBEX operatives may be imminent. However, the fact that CBEX has been able to resume operations suggests challenges in enforcing regulatory bans, particularly for platforms that operate primarily online and may have offshore components.
Risks for Investors
Financial regulators and consumer protection advocates are sounding the alarm about the risks of engaging with CBEX. The platform’s history of alleged fraud, combined with its unregistered status and controversial compensation scheme, makes it a high-risk proposition for both new and existing investors. Key risks include:
- Loss of Funds: Given CBEX’s track record, there is a significant risk that new deposits could be lost, with little recourse for recovery.
- Legal Exposure: Engaging with an unregistered platform could expose investors to legal consequences, particularly if CBEX is found to be involved in money laundering or other illicit activities.
- Lack of Transparency: The opaque nature of CBEX’s operations, including the undisclosed audit and offshore ties, makes it difficult for investors to make informed decisions.
- Ponzi Scheme Concerns: The reinjection requirement and promises of high returns mirror the characteristics of Ponzi schemes, which are inherently unsustainable.
Advice for Investors
Experts recommend that Nigerians exercise extreme caution when considering CBEX or similar platforms. Key steps to protect yourself include:
- Verify Registration: Only engage with platforms registered with the SEC or other reputable regulatory bodies.
- Conduct Due Diligence: Research the platform’s history, leadership, and financial practices before investing.
- Avoid High-Risk Schemes: Be wary of platforms promising guaranteed returns or requiring additional payments to recover losses.
- Seek Professional Advice: Consult with a licensed financial advisor before making investment decisions.
- Report Suspicious Activity: If you suspect fraud, report it to the SEC, EFCC, or local authorities immediately.
Conclusion
The resumption of Crypto Bridge Exchange’s operations marks a troubling development in Nigeria’s cryptocurrency landscape. While the platform’s return may offer hope to some investors desperate to recover their losses, the risks far outweigh the potential benefits. With ongoing investigations, a regulatory ban, and a questionable compensation scheme, CBEX remains a high-risk entity that investors should approach with extreme caution.
As Nigeria continues to grapple with the challenges of regulating cryptocurrencies, the CBEX saga underscores the need for stronger oversight and investor education. For now, Nigerians are urged to steer clear of unregistered platforms and prioritize the safety of their hard-earned money.
Disclaimer: This article is for informational purposes only and does not constitute financial or investment advice. Always conduct thorough research and consult with a qualified professional before making investment decisions.
