As on October 2021, India had the highest number of cryptocurrency investors in the world, which stands at 10.07 crore investors. However, Virtual Digital Assets (“VDA”) like cryptocurrencies and NFTs are extremely volatile.
Elon Musk on 3rd June 2021, tweeted with a meme about breaking up with Bitcoin, and the price of Bitcoin declined by 5 percent. This instance aptly encapsulates the volatility of the crypto market.
In view of the above explained volatility and large consumer base, on 23rd February 2022, Advertising Standards Council of India (“ASCI”) issued a list of elaborate guidelines for creators and advertisers for promoting VDA (like cryptocurrencies, Non-Fungible Tokens (“NFTs”), etc.)
Following is the summary of the guidelines that creators and advertisers must adhere to while advertising VDA: (it is not an exhaustive list, please refer to the ASCI guidelines here)
Disclaimer Provided by ASCI:
ASCI has provided the following disclaimer for creators and asked them to mention it in a prominent manner:
“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 should be accompanied with all types of content. For example: –
- Advertisement in print/static form – 1/5th of the space of the advertisement.
- Advertisement in video form – appearing at the end of the advertisement along with the voiceover and text in plain background. If the advertisement is over 2 minutes, at the beginning and end of the video.
- For social media posts – on the picture or the video along with the caption of the post.
- Advertisers should not use the words like – currencies, securities, custodians and depositors, as the consumers relate these terms with regulated products.
- For Prominent personalities who appear/endorse VDA or trading of VDA
These personalities are instructed by the ASCI to carry out due-diligence. This due-diligence should be with respect to the statements they communicate to the customers through their endorsements.
In order to protect the interest of consumers, it is pertinent to regulate advertising of cryptocurrency. One of the major concerns around cryptocurrency is its illegitimate use and volatility. In such a setting, it becomes important for authorities to formulate guidelines. Therefore, creators and advertisers must bear in mind these guidelines while putting out their advertisements.
Further, in India, the Blockchain and Crypto Assets Council has set up a code of conduct for the players in the industry for the purposes of compliance. This move brings more legitimacy in the process of dealing with virtual digital assets.
The content of this article is intended to provide general guidance on the subject matter. Specialist advice should be sought about your specific circumstances.
Key Words: Cryptocurrency, Guidelines, Advertisements, ASCI, Elon Musk, creator.