With the growing popularity of cryptocurrency, several apps and services are also coming up that allow users to trade in digital currencies. To monitor the situation and regulate the advertisements related to cryptocurrency, the Advertising Standards Council of India (ASCI) has issued guidelines for virtual digital assets (VDA). This includes ads about both cryptocurrency and non-fungible tokens.
The new set of guidelines will be in effect from April 1, 2022. Any advertisement published before this period and advertisement that does not comply with the new guidelines shall be taken down before April 15, 2022. The main focus of the new guidelines is to add a proper disclaimer with the advertisements related to NFTs or cryptocurrencies that says “Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions.” This disclaimer shall be made in a manner that is prominent and unmissable by an average consumer.
In addition, the new ASCI guidelines warn advertisers about the usage of certain terms such as “depositories, securities and currency” in the ads for VDAs as customers might connect these terms with modes of investments that are regulated. Further, the information contained in advertisements shall not contradict the information or warnings that the regulated entities provide to customers in the marketing of VDA products from time to time.
Other ASCI rules on cryptocurrency ads
- Information on past performance shall not be provided in any partial or biased manner. Returns for periods of less than 12 months shall not be included.
- Every advertisement for VDA products must clearly give out the name of the advertiser and provide an easy way to contact them (phone number or email). This information should be presented in a manner that is easily understood by the average consumer.
- No advertisement for VDA products or exchanges may show a minor, or someone who appears to be minor, directly dealing with the product, or talking about the product.
- No advertisement may show that VDA products or VDA trading could be a solution to money problems, personality problems or other such drawbacks.
- No advertisement shall contain statements that promise or guarantee a future increase in profits.