- Both firms have already removed the advertisement.
- The previous forms hard ordered the trading companies not to run the ads.
The British advertising watchdog, the Advertising Standards Authority, is clamping down on illegal cryptocurrency ads, targeting eToro and Coinbase in the recent move.
According to a Wednesday announcement from ASA, the trading firms ran paid advertisements on online sites to promote their crypto services. However, regulators have labeled the ads as misleading and irresponsible.
Coinbase’s advert emerged on Facebook on 27 July 2021, encouraging individuals to register with the platform for massive returns within a decade. It also highlighted Coinbase’s advantages and called its competitors unregulated.
On the other side, eToro’s ad appeared on Yahoo Finance on 27 August 2021, promoting the company’s ready-made cryptocurrency investment portfolio. The regulator referred to both cases as misleading and irresponsible ads.
The watchdog believes the ads took advantage of users’ credulity and inexperience to illustrate the investment’s risks. Coinbase faced further charges for calling its competitors unregulated and past BTC price reference.
While eToro admitted the missing risks warning, Coinbase denied the regulatory claims. The watchdog has directed the companies not to run the adverts as previously and clarify risks and crypto’s unregulated nature in the UK.
eToro official told Finance Magnates that it is seeking Independent Review as its trusts ASA’s ruling had a fundamental error. The spokesperson calls ASA to consult the industry and FCA before embarking on the move requiring financial products advertisers to include potential tax implication warnings within the ads.
He added that eToro finds itself in a disadvantaged position with the ruling, and the crypto company will try to comply with the regulation regardless of the practical challenges. However, the official believes other cryptocurrency market participants may not adhere to the policies.
Meanwhile, the United Kingdom agency had flagged several other crypto ads in the nation and introduced a ‘red alert’ on digital coins advertising. Nevertheless, Facebook and Instagram accepted crypto adverts over the past weeks.
What are your thoughts about cryptocurrency ads? Do they mislead market players? You can use the reply section below to share your thoughts.