India Releases Crypto Advertising Guidelines
The Advertising Stands Council of India (ASCI) has released guidelines for advertising virtual assets. The guidelines will take effect after April 1, 2022. The Council has also explained that earlier advertisements cannot be displayed to the public before they comply with the new directives.
What the Indian Government Expects of Crypto Advertisements
Earlier today, the ASCI revealed the guidelines for crypto advertising in the country. The Council warned against untruthful and misleading crypto advertisements through its press release article. The directives will take effect no earlier than April 1, 2022.
The government mainly expects all crypto-related advertisements to include the following statement: “Crypto products and NFTs are not regulated and could be extremely risky. There is no legal recourse in case of loss resulting from what results from these transactions.”
The guidelines also rule that terms like “custodian,” “currency,” “depositories,” and “securities” be dropped in all advertisements. The main reason to omit these terms is to avoid confusing investors with regulated products.
They also require details like the profitability and cost of the advertised digital products to be fulfilling, updated, and clear. For example, “zero cost” will require including all costs that an investor may comfortably associate with an offer.
The directives also rule that advertisements with profits accrued in under 12 months be omitted. They explained that the reason behind the omission is to offer information on the historical performance of the asset in question.
What India’s Advertising Regulators Have to Say
India’s advertising regulators feel that some of the available crypto advertisements are misleading as they do not disclose involved risks openly. The effort by the government to bring crypto advertisement clarity is to prevent the misleading of its citizens.
Subhash Kamath, Chairman of ASCI, said:
“We had several rounds of discussion with the government, finance sector regulators, and industry stakeholders before framing these guidelines. Advertising of virtual digital assets and services needs specific guidance, considering that this is a new and as yet an emerging way of investing. Hence, there is a need to make consumers aware of the risks and ask them to proceed with caution”.
Another official, Manisha Kapoor, Secretary-General, ASCI, also stressed the need for clarity in crypto advertising in the country. She noted that advertisements with inadequate information trap people into schemes that result in heavy losses.
Kapoor said:
“We have seen a spate of advertising for virtual digital assets which could compromise consumer interest in the absence of some guardrails. Use of celebrities and high decibel advertising would attract consumers to these offerings, without full disclosure of the risks. Given that this is, as of now, an unregulated space, it is even more important for advertising to be upfront regarding the risks associated with these products. Globally, this is an emerging technology and products in the virtual digital asset industry have seen significant volatility. We believe with these guidelines, advertisements would be fairer and more transparent.”
Lately, India has been very active in bringing legal clarity on digital assets to safeguard its citizens from possible risks. Since crypto advertisement guidelines are finally out, risky investment schemes like pump and dump will reduce.
