• The South African Advertising Regulatory Board (ARB) has released an updated code of advertising practice for crypto market participants.
• Under the new guidelines, crypto businesses must send clear risks warnings and state that investing in bitcoin (BTC) and altcoins is risky and may result in capital loss.
• Crypto influencers have also been warned against making bogus crypto claims.
The South African Advertising Regulatory Board (ARB) has recently released an updated code of advertising practice for crypto market participants. The new guidelines come in the wake of a tumultuous year for the crypto space, with the steep drop in the price of bitcoin and other cryptocurrencies, coupled with wanton customer funds mismanagement and alleged fraudulent practices leading to high-profile bankruptcies.
Under the new guidelines, crypto businesses must ensure that any advertisement published by them “expressly and clearly” states that crypto assets are risky investment vehicles that may result in total loss of capital since their prices are never stable. Furthermore, the advertisement must explain the relevant product or service in a way that is easily understandable for the intended audience. As such, the overall message of the advertisement must not contradict the warning statements.
Additionally, the ARB has also mandated that crypto influencers must refrain from making bogus crypto claims. Such influencers are required to clearly state that their content is not to be taken as financial advice, and must also inform their followers that investing in cryptocurrencies is risky and may result in capital loss.
The new advertising code of practice is part of the ARB’s continuing efforts to promote responsible and legal crypto advertising practices. It is hoped that the new guidelines will help protect investors from fraud and other illicit activities, while also helping to bring more clarity and stability to the crypto markets.