The UK's Advertising Standards Authority (ASA) has issued an enforcement notice to over 50 companies that advertised crypto services. This move comes as part of the nationwide crackdown on misleading crypto ads in the UK.
In an official statement, the regulator pointed out that the notice provided clear guidance for crypto ads. It urged the companies to review their ads to ensure that they are in line with the new guidance.
According to the ASA, the new guidance mandates advertisers to clearly state that cryptocurrencies are still unregulated in the U.K. and that the value of their investments could go down. The ads must also not "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’."
A "Red Alert" Priority Issue
The advertising regulator noted that the notice applies to crypto promotions that are targeted at UK consumers and those targeted at a global audience on behalf of UK-based companies. The ASA added that it considers this a "red alert" priority as it continues to combat misleading crypto ads.
"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 regulatory watchdog said.
Following the surge in crypto ads in recent months, the ASA has intensified its efforts to crack down on misleading ads. The regulator had banned Floki Inu ads on London Undergrounds. It had also banned "irresponsible" ads from Coinbase, eToro, Papa John's and the popular football club, Arsenal.
ASA to Work With FCA to Enforce New Guidance
The advertising regulator revealed that it will be working closely with the Financial Conduct Authority (FCA) to take action against companies that do not comply with the new guidance.
The ASA warned that companies advertising crypto services have until the 2nd of May to ensure their ads meet the new guidance. Companies that fail to do so will be reported to the FCA.
Speaking on the latest move, the ASA's 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."
Sarah Pritchard, Executive Director of Markets at the FCA reiterated the FCA's earlier warnings about crypto investments and pledged to continue helping the ASA to combat irresponsible ads
She said, "We will continue to work closely with the ASA to tackle unclear or misleading crypto advertising. People should be wary of any promotion promising high investment returns and do further research before investing… Crypto assets remain unregulated and those who invest in them should be prepared to lose all their money."
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