UK advertising authority takes action against ‘irresponsible and misleading’ Bitcoin ad

Bitcoin ad

A Bitcoin advertisement was the subject of a complaint that was investigated by the Advertising Standards Authority (ASA) of the United Kingdom. Coinfloor, a cryptocurrency exchange, was the entity that placed the ad in question on 3 December 2020 within the regional press. The text in the advertisement, which was criticised heavily, was given the title “there is no point in keeping your money in the bank…”

The advertisement for Bitcoin, which was rumoured to be “targeting” retirees, featured a woman in her sixties who appeared to have invested her pension in Bitcoin. The following is a quote from her:

There is no point in putting it in the bank at the moment because the interest rates are so insulting […] Because of this, when I started receiving my pension, the first thing I did was invest one third of it in gold, one third of it in silver, and the rest of it in Bitcoin… Bitcoin is essentially digital gold to me, and using it has enabled me to take precautions to protect the cash that I already have…

The complaint questioned whether or not the advertisement “failed to make clear the risks associated with Bitcoin investments,” which would make it “misleading.” It was determined that the advertisement was “socially irresponsible” because it gave the impression that “purchasing Bitcoin was a good or secure way to invest one’s savings or pension.”

Coinfloor asserted that the advertisement did not imply that the customer’s actions “constituted a wise or secure investment” in their defence of their company. It refuted the notion that the person in the advertisement gave the impression that Bitcoin investments would result in financial gain for investors. According to Coinfloor, the advertisement discussed how a customer hedged their exposure to inflation by purchasing Bitcoin as part of a larger investment portfolio. They asserted that this was a “generally accepted strategy.”

In addition, the advertisement included the following disclaimer:

Putting your money into cryptocurrency comes with a high level of risk and runs the potential to wipe out all the money you’ve put in. You should never put in more money than you can afford to lose in a financial investment.

Nevertheless, the ASA believed that the disclaimer was “insufficient to counteract the overall message” and that it did not ensure that customers “were made aware of the risk of loss of capital.” In addition, the ASA stated that the following should have been included in the disclaimer:

Customers were discouraged from putting their money in banks by an advertisement that made a direct comparison between putting savings into Bitcoin and using regulated services.

The Advertising Standards Authority (ASA) came to the conclusion that the ad “must not appear again in its current form.” According to reports, the advertising agency instructed Coinfloor “to ensure” that any future advertisements must make Bitcoin’s volatile nature “sufficiently clear.” Additionally, the agency reportedly reminded Coinfloor that both it and cryptocurrency are unregulated.