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In its latest crackdown on cryptocurrency firms, the UK’s advertising regulator, the Advertising Standards Authority (ASA), announcement in a Wednesday, Jan.5 decision that it banned two ads from Hong Kong-based blockchain startup Crypto.com.
The ban was primarily due to the “deceptive” nature of two in-app ads, first seen on September 1, 2021 in the Daily Mail app, with text that read “Buy Bitcoin with Credit Card Instantly”. The second ad, which aired in the Love Balls mobile game app on July 30, 2021, included the following: “Earn up to 3.5% [per annum], “a number which later rose to” 8.5% “.
ASA has challenged Forisgfs UK Ltd – operating as Crypto.com – on five grounds, all of which were upheld in the ruling.
They included the fact that the two ads were not only “irresponsible and taking advantage of the inexperience or gullibility of consumers,” but they did not clearly define the risks associated with crypto investing. The ASA also ruled that the “Earn up to 8.5%” claim in the Love Balls ad “could not be substantiated.”
The regulator then ordered the cryptocurrency trading platform to ensure that future announcements “sufficiently clarify” how volatile cryptocurrency investments were and that the cryptocurrency was unregulated at the time. UK.
“We told them that future advertisements should make it clear that purchasing cryptocurrency using a credit card may be subject to higher interest rates, additional fees, and that some issuers of credit cards prohibit the purchase of cryptocurrency, “the ASA added, further demanding that the company ensure they had” adequate justification “to substantiate the basis of any future projection in their announcements. .
Read more: Coinbase and eToro Crypto Ads Banned to Deceive Consumers, UK Advertising Regulator Says
However, Crypto.com is not the first cryptocurrency company to come under the wrath of the ASA. Last month, the watchdog took action against seven of the industry’s biggest companies, including Coinbase and eToro, for deceptive and irresponsible ads promoting crypto investments.
The American pizza chain Papa John’s, which claims to have been the first company to offer free Bitcoin for pizza purchases in the UK, has also been targeted by the ASA for “trivializing†its investments in crypto assets. The promotion was organized in association with the cryptocurrency exchange Luno Money, another company that has also received a warning from the regulator.
The decisions came after the regulator announced in July that deceptive crypto marketing was a “red alert” priority the agency would begin to pay close attention to. “We consider this to be an absolutely crucial and priority area for us”, Miles lockwoodASA’s director of complaints and investigations said at the time, according to a PYMNTS report.
See also: Matt Damon is now the face of Crypto.com
Crypto.com claims to offer over 150 cryptocurrencies, serving over 10 million customers worldwide in 90 countries. In recent months, the company has made a major marketing effort as it seeks to expand its base, running ads featuring actor Matt Damon in more than 20 countries, PYMNTS reported.
Also read: Bank of England Governor Says Cryptocurrencies Should Be Regulated
But the Hong Kong-based blockchain startup will need to tread carefully in the UK, where public sector leaders are exploring ways to regulate the industry amid the ongoing crackdown on digital currency companies.
In October, the Deputy Governor of the Bank of England (BoE), Sir Jon cunliffe called for immediate regulation of cryptocurrencies, while recognizing that digital funds do not pose a threat to financial security. According to a report from PYMNTS, however, he said that could change, potentially leading to a crypto crash that could invade the markets.
Related news: Bank of England: Steps Needed to Manage Potential Crypto Risks
Cunliffe’s call for crypto regulation follows a report by the BoE’s financial policy committee, which said regulations and law enforcement guidelines are needed to manage the risks associated with crypto. currencies both in England and around the world.
Also linked: UK crypto exchanges are subject to a 2% tax, not exempt as the country does not recognize digital assets
And in November, it was announced that UK-based crypto exchanges will not be granted an exemption to financial markets and will now have to pay a new digital services tax, as Her Majesty’s Revenue and Customs (HMRC) does not recognize not digital assets. as financial instruments.
Learn more about UK crypto regulations:
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