The Advertising Standards Authority (ASA) of the United Kingdom has issued warnings last March 22, 2022 to more than 50 crypto companies operating in the country in regards to potentially misleading and irresponsible crypto advertising. It reinforced a list of guidelines discussing new compliance measures and potential sanctions for violators.
The article posted on the official ASA website revealed the rules to be followed and delved into the reason why the warnings are essential. It also talked about the meaning of cryptocurrencies, what digital assets can do and how risky the investments can be if not handled properly.
‘This is a red alert priority issue for us and we’ve recently banned several crypto ads for misleading consumers and for being socially irresponsible’, the post says. It also targets cryptocurrency exchanges, digital assets and any other form of promotional content that seeks to sell or invest in crypto.
The ASA did not release an official list of the companies that were sent warnings. However, a possibility of sanction has been enforced for the companies that will not withdraw or fix their ads by May 2, 2022. These are considered to be ‘problem ads’ that can mislead potential clients into blindly investing in cryptocurrency with no additional context.
According to the post published by the ASA, there are basic guidelines and enforcement notices that every crypto company must follow when it comes to releasing advertisements to reach out to their customers. These are as follows:
- ‘Should clearly state that cryptocurrencies are unregulated in the UK and that the value of investments are variable and can go down’
- ‘Must not state or imply that investment decisions are trivial, simple, easy or suitable for anyone’
- ‘Must not imply a sense of urgency to buy or create a fear of missing out, or that investments are “low risk”.
In response to the ASA’s actions, Hargreaves Lansdown senior investment analyst Susannah Streeter has spoken with the Blockworks outlet in an article published last March 22 and said that the government agency can only censure the companies at most for the released ads.
‘The rollercoaster ride is set to continue, given that crypto assets are also highly sensitive to the fortunes of the stock market and were propelled higher in an era of ultra-cheap money’, she said in a statement submitted via email.
This is not the first time that the ASA has intervened and proceeded to ban ads made by companies operating in the UK. According to reports by CNBC, they have banned ads made by Coinbase and Papa John’s in the past due to concerns that their promotional content may have misled potential customers.
As of now, there are no developments as to which companies have violated the ASA’s regulations and whether or not any promotional content will be withdrawn or replaced on the market. The recent announcement is considered as a warning to these companies to review the materials being published online for all to see.
Learn more about cryptocurrency news and all the latest updates when you access the content here at Cryptoshimbun!