South Africa Mandates New Advertising Campaign Codes for Crypto Ads

South Africa Mandates New Advertising Campaign Codes for Crypto Ads

South Africa mandates new advertising codes for crypto advertising campaigns. Crypto asset service providers looking to attract investors through advertising campaigns must "expressly and clearly state that investing in crypto assets may result in the loss of capital." Influencers working on behalf of crypto asset service providers should "not offer advice on trading or investing in crypto assets, nor promise benefits or returns."

Collaborative Effort of ARB and Crypto Exchanges

The Advertising Regulatory Board (ARB) of South Africa has mandated a new code for crypto-related advertising. The public must be clearly warned that investing in digital assets "may result in the loss of capital." Further, ARB’s latest code states that the copywriting used in the ads should comply with the warning.

The new crypto asset advertising guidelines are reportedly the result of a collaborative effort between ARB and South African crypto exchanges. They are seemingly intended to preclude scammers from targeting their victims on regulated media platforms. Commenting on the latest advertising code for crypto assets, Gail Schimmel, the CEO at ARB, said:

"This is a wonderful example of an industry that sees the harm that could be done in its name and steps up to self-regulate the issues without being forced to do so by the government. This has been an exciting project, and we know that it will result in better protection for vulnerable consumers."

The self-regulatory board wants the ads to use language easily understood by the targeted audience, in addition to the capital loss warning. The new code also stipulates that the promises of future earnings or gains in the ads must be backed "by adequate substantiation that complies with the requirements of Clause 4.1 of Section II."

Similarly, advertisements that refer to past performances should not be presented in a way that leaves a "favorable impression of the advertised product or service." 

Influencer Impact Curtailed

Wherever an influencer is hired or used to entice potential investors, the new code states that the concerned individual must "share factual information only." All the influencers and project ambassadors are barred from offering "advice on trading or investing in crypto assets and should not promise benefits or returns."

What is your take on the new advertising codes for crypto ads? Please post your comments.