The UK Advertising Standards Authority has issued an enforcement notice to over 50 companies that advertise cryptocurrencies, telling them to review their advertisements for compliance before publishing.
“The enforcement notice provides guidance to the crypto industry on how to stick to the rules and warns that we will monitor for compliance and implement sanctions if we do not see improvements,” the ASA said in a statement.
The new rules demand advertisers clearly state that crypto is unregulated and that the “value of investments are variable and can go down.”
Additionally, advertisements must not “state or imply that investment decisions are trivial, simple, easy or suitable for anyone” or “imply a sense of urgency to buy or create a fear of missing out, or that investments are low risk.”
Last Dec, the ASA banned seven ads “for irresponsibly taking advantage of consumers’ inexperience and for failing to illustrate the risk of the investment.”
And a month later, the Financial Conduct Authority (FCA) announced it was tightening oversight of crypto advertising after receiving new powers from the government.
ASA Chief Executive Guy Parker said: “Crypto has exploded in popularity in recent years. We’re concerned that people might be enticed by ads into investing money they can’t afford to lose, without understanding the risks. Working alongside the FCA, we’ll take strong action against any advertiser who fails to ensure that their ads are responsible.”
UK investors “should be prepare to lose all their money”
“We will continue to work closely with the ASA to tackle unclear or misleading crypto advertising,” she added.
Executive Director of Markets at the FCA, Sarah Pritchard, has warned that crypto investors should be “prepared to lose all their money” as the sector remains unregulated.
Advertisers have until May 2 to ensure they meet the new standards. If they do not, they risk being reported to the FCA.
Earlier this month, the ASA banned Floki Inu advertisements, claiming that the advertisement “irresponsibly exploited consumer’s fears of missing out, and trivialized cryptocurrency.”
BeInCrypto has reached out to company or individual involved in the story to get an official statement about the recent developments, but it has yet to hear back.