JOIN USComing soon: Crypto ads with proper warning labels
Gone are the days when Bollywood stars from Ayushmann Khurrana to Ranveer Singh could freely urge you to spend your money on crypto assets without highlighting the risks tied to such products.
India's top advertising watchdog has unveiled a dozen rules on ads tied to crypto products and non-fungible tokens in a bid to push for more responsible advertising from cryptocurrency platforms and protect consumers.
From April 1, all virtual digital assets and services ads will need to carry the disclaimer “Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions”, the Advertising Standards Council of India said on Wednesday.
“This is a new and as yet an emerging way of investing. Hence, there is a need to make consumers aware of the risks and ask them to proceed with caution,” ASCI Chairman Subhash Kamath said.
The move came after ASCI noted that many of these ads did not “adequately disclose” the risks. The government has also raised concerns about the opaque advertising of crypto products.
The new rules "may slow down new customer onboarding, but long-time believers in blockchain and crypto will not step down because of advertising guidelines," crypto investor Samrat Mazumdar told DH.
ASCI has asked the advertisers to avoid using the words “currency”, “securities”, “custodian” and “depositories” in such ads as people associate these terms with regulated products. The new rules also restricted advertisers from showing returns for periods of less than a year.
“Since this is a risky category, celebrities or prominent personalities who appear in VDA advertisements must take special care to ensure that they have done their due diligence about the statements and claims made in the advertisement, so as not to mislead consumers,” the watchdog insisted.
ASCI, which only provides self-regulation for content of ads that are permitted by law, clarified that these guidelines do not amount to any legal recognition or endorsement of the industry or the sector, as that is a matter of government policy.
Crypto exchanges said the rules made sense.
“The new guidelines adds in more clarity and we are committed to abide by these and represent our brand in the right light,” said Ramalingam Subramanian, the head of brand, marketing and communication at crypto exchange CoinDCX.
Rival CoinSwitch’s founder, Ashish Singhal, said there were “nuances that need to be addressed as the space is ever-evolving”.
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