Crypto Marketing: Agency Bans Adverts

December 16, 2021 | By Paul Mackenzie Ross | Filed in: marketing.
  • Several cryptocurrency ads have recently been banned by the UK’s Advertising Standards Authority (ASA) as the advertisers been found by the authority to have broken the rules.

The crypto ads and crypto campaigns in question were mostly from cryptocurrency exchanges but also included two household names; eToro, normally known for its stocks and shares trading platform, and Papa John’s, the pizza chain, were the two big brands to draw the ASA’s attention.

The seven ads and promotions ranged from a digital poster to a Twitter post and ad, a Facebook ad, display ad, in-app advert and a YouTube promotional video.

In every case the ASA upheld challenges to the ads for “irresponsibly taking advantage of consumers’ inexperience and for failing to illustrate the risk of the investment”.

On “customers’ inexperience”, one of the ads claimed that crypto trades were, to use an Americanism, “super easy” alongside the fact that users could register quickly and make instant deposits into their trading accounts.

The ASA deemed that, in this case, whilst the platform itself may have been user friendly, the action of investment was a complex one and the advertiser had failed to convey this.

Another complaint was against a digital poster at London Bridge station in August 2021. Whilst the ad for an online cryptocurrency exchange started with a warning about the high volatility of trading, and that the service was unregulated by UK financial watchdogs, the message lasted just one second before a number of “ease of use” claims were made.

As for Papa John’s, in May 2021 the pizza chain posted a promotion on their website offering “free bitcoin worth £10” when customers spent £30 or more. This campaign was backed up by a Twitter post. Almost exactly 11 years ago the firm was paid 10,000 bitcoin for two pizzas. Those same crypto coins today would be worth over £450,000!

In all cases the ASA upheld challenges for:

  1. irresponsibly taking advantage of consumers’ inexperience and
  2. for failing to illustrate the risk of the investment.

New Guidance on Cryptocurrency Advertising

In light of these breaches of advertising standards, the ASA has said it hopes to produce new guidance on cryptocurrency ads.

Cryptoassets, as The Bank of England refers to them, are currently unregulated. The numerous currencies include Litecoin, Ripple, Ethereum, and Shibu Inu. An estimated 2.3 million people are thought to hold cryptocurrency in the UK, amounting to about 0.1% of household wealth.

However, The Bank is concerned with the huge growth rate in crypto and interest from traditional financial institutions wishing to hold cryptocurrencies in their portfolios. The variation in currency prices, were crypto to be integrated into wider financial systems, could affect the stability of broader markets and systems.

The Bank of England has stated that, whilst it will take time to build standards and regulations for the industry, it needs to start working on a regulatory framework to manage the risks of crypoassets.

The Advertising Standards Authority continues to review cryptocurrency ads as well as those for Non Fungible Tokens (NFTs) and the new breed of “fan tokens”. It hopes to update its guidance next year just as it has recently published guidance on advertising on environmental claims and social responsibility.

Integrating responsible consumer messages in crypto advertising requires an intelligent digital marketing expert. The rules are clear and firms just require the right expertise to navigate.

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