Saturday, February 4, 2023

BCAC Working On Crypto Exchanges Advertisement Guidelines

The Blockchain and Crypto Assets Council (BCAC)  will soon introduce a new set of advertisement guidelines for the crypto industry in India to establish how crypto exchanges will promote themselves on different platforms like televisions, Netflix, Amazon Prime and others.

Several crypto exchanges in India, which include WazirX, CoinDCX and CoinSwitch Kuber, have been promoting cryptocurrencies without giving sufficient warning about the drawbacks of investing in digital assets. This led the digital trading platforms into great trouble with regulators, therefore, the council decided to establish new guidelines for the crypto advertisements.

One of the members of the advisory board of the crypto council, Navin Surya, has recently said that they already have started working on advertising guidelines, which would be part of the self-regulatory framework.

Why Advertising Guidelines For Cryptos Are Important?

Initially, when cryptocurrency was introduced in the market, not many Indians were interested in it. However, along with the time, people started realizing how cryptocurrency could be a game-changer. In the past three years, the Indian crypto industry saw a huge development, as many people changed their perception regarding cryptocurrency. 

In the meantime, the Indian crypto exchanges also kept working on their part to increase their business. They started sponsoring bigwig events around the world like the Euro 2020 football championships, the Indian Premier League (IPL) cricket tournament and the T20 tour between India and Sri Lanka. 

The crypto exchanges’ plan did work, they were becoming popular but along with that, they started facing criticism, also. 

Aayush Shukla and Vikash Kumar, two of the well-known advocates, filed a plea against the Indian crypto exchanges in Delhi High Court. 

The plea filed by the advocates stated that none of the ads presented by the crypto exchanges give enough warning regarding the risks involved in crypto investment. It further stated that the disclaimer text should cover 80 percent of the screen.   

Like many OTT platforms in the country, the Indian crypto exchanges are also dwelling to self-regulate themselves.

A few weeks ago, the Delhi High Court released an order for regulating crypto advertisements in the country. Following that, the Advertising Standards Council of India (ASCI) indicated that it could introduce guidelines with crypto advertisements. However, those guidelines would not be legally enforceable in the industry. But it has been mentioned that the violation of regulatory guidelines would be a violation of government rules.

One Size Disclaimer Needed

The issue with exchanges is that they do not release disclaimers with the crypto ads. But if they flash a disclaimer, the exchanges use a different font, size, style. For instance, the ads released by WazirX flashes disclaimer but in a very small font and too at a corner. Similarly, CoinDCX and CoinSwitch Kuber ads’ disclaimer appears at the right side end and their font sizes are different.

According to Delhi High Court’s order, there should be a standardized approach for crypto ads disclaimer. Every company should use similar fonts, size, screen space and duration for the disclaimer. This way, the playfield for crypto exchanges would be leveled and the investors will come to know the format and the risks involved in the crypto markets.

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