By Chris Vallance
Seven cryptocurrency adverts have been banned by the UK’s advertising watchdog.
The Advertising Standards Authority (ASA) says monitoring cryptoassets, like Bitcoin, is a “red-alert priority” following concerns that many ads fail to fully convey the risks of investing.
The banned ads included a promotion by a pizza chain and Facebook ads for a large cryptocurrency exchange.
The ASA says it hopes to produce new guidance on cryptocurrency advertising.
All seven ads or promotions were “banned for irresponsibly taking advantage of consumers’ inexperience and for failing to illustrate the risk of the investment”, it said.
The companies whose ads were found to have broken the rules were:
- Coinburp: A Twitter page for Coinburp, a cryptocurrency trading platform.
- eToro (UK): A paid-for display ad for eToro, a stocks and cryptocurrency trading platform.
- Payward: A digital poster for Kraken, an online cryptocurrency exchange.
- Exmo Exchange: A YouTube video promoting cryptocurrency exchange Exmo
- Luno Money: An in-app ad for Luno, a cryptocurrency exchange service.
- Coinbase Europe: A paid-for Facebook ad for Coinbase, a cryptocurrency exchange platform.
- Papa John’s GB: A promotion on the Papa John’s pizza restaurant chain’s website and in a Twitter post.
The banned Papa John’s website promotion offered consumers “free Bitcoin worth £10”, as well as telling customers: “Save £15 when you spend £30 or more & get £10 worth of Bitcoin from Luno!”
The firm said it was part of their annual celebration of “Bitcoin pizza day”, which is said to mark the trading of two Papa John’s pizzas for 10,000 bitcoins in May 2010. Ten thousand bitcoins would today be worth more than £350m ($462m).
The company argued that the promotion did not make any comment on cryptocurrency or its suitability for investment.
The chain said the “free” Bitcoin offer was entirely different from a scenario where a consumer was given the opportunity to invest their own money in a financial product.
But the ASA found the offer “trivialised what was a serious and potentially costly financial decision, especially in the context of the intended audience who were likely to have limited knowledge of cryptocurrency”.
The ad for Kraken, which led to a complaint to the ASA, was seen at London Bridge station on a digital poster.
Although it contained a lengthy disclaimer, the ASA considered that “consumers would not have had the time to comprehend the relevant information in the disclaimer, if seen at all, and that it therefore was not clear”.
The decision comes as some politicians question whether any cryptocurrency adverts should run on London’s trains and buses.
In November, the ASA announced that it was investigating adverts that appeared on the underground for cryptocurrency Floki Inu – a so-called “meme coin” named after billionaire Elon Musk’s dog.
That investigation continues, the ASA says, although Floki Inu insists that their adverts abide by the rules.
The bans form part of a broader project that will result in updated guidance for the advertising of cryptoassets next year.
Miles Lockwood, the watchdog’s director of complaints and investigations, said: “Cryptoassets are a red-alert priority issue for us.
“Consumers need to know about the risks of investing in cryptoassets and companies should make sure that their ads aren’t misleading or socially irresponsible by taking advantage of consumers’ lack of awareness around these complex and volatile products,” he said.
The ASA said it would continue to review cryptoasset ads over the next few months, not just for cryptocurrencies but also for NFTs and fan tokens.