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The AFL’s crypto exchange partner Crypto.com has repeatedly violated UK advertising standards and has been accused of “misleading” and “irresponsible” behavior.
A decision by the UK Advertising Standards Authority (Asa) could lead to further scrutiny of Crypto.com promotions in Australia.
A five-year partnership between AFL and the Singapore-based exchange was announced in January 2022. Since then, Crypto.com has been promoted around his AFL stadium.
In December, Asa ruled that Crypto.com’s local ads “failed to explain the risks of investing in non-fungible tokens (NFTs).” We also found that the advertisement did not make it clear that a fee would apply.
In response, Crypto.com challenged the ruling, stating that there is no need to mention fees in its ads, which would “just confuse consumers.”
In early 2022, regulators upheld rulings against two other ads accused of exploiting consumers’ “inexperience or credulity.”
One of the advertisements said “buy bitcoin with a credit card now”, but the regulator did not make it clear that “taxes can be paid on cryptocurrency gains and credit card It took advantage of consumers’ inexperience and creditworthiness by irresponsibly encouraging cryptocurrency investments in . .
Another ad told consumers that they could “earn up to 8.5%,” which Asa believed was misleading “because the revenue projections were not clearly calculated.”
Crypto.com told regulators that these ads were removed as soon as concerns were raised and the surveillance process was stepped up.
It is unknown if any of these ads were placed in the Australian market.
A Crypto.com spokesperson said the company is “trusted by more than 70 million customers worldwide and is an industry leader in regulatory compliance, security and privacy certifications.”
The Australian Securities and Investments Commission (Asic) is calling for a regulatory framework for cryptocurrencies and crypto-assets such as NFTs to better protect consumers. While it was being developed, a spokesperson said the rules on misleading and deceptive behavior still apply to all types of crypto assets.
An Asics spokesperson said, “Companies that mislead or deceive in their advertising are breaking the law.”
Regulators filed a federal lawsuit against BPS Financial in October over misleading and deceptive claims about the Qoin cryptocurrency alleged by Asic, and Block Earner in November for selling financial products without an Australian financial services license. filed in federal court for allegedly providing.
The matter remains in court. BPS plans to file a defense next month.
Dr. Paul Mazola, a cryptocurrency expert at the University of Wollongong, said the AFL partnership with Crypto.com poses a risk to Sportscode’s reputation.
Mazzola said Asic could take action if a similar ad appeared in Australia.
“Finally, Asic must insist that the advertised crypto assets clearly fit the definitions provided below. [Asic rules]it probably is, ”he said.
Mazola recommended changing the rules to explicitly include cryptocurrencies and NFTs.
“This tells the market, especially cryptocurrency exchanges like Crypto.com, to be careful when framing their advertisements, and in particular all warnings related to the risks associated with investing in the cryptocurrency market. It sends a clear message that it should be included.”
The AFL, when asked for comment, referred to an earlier statement in November in which it said it would maintain its partnership with Crypto.com following the demise of one of the world’s largest crypto exchanges, FTX.
Crypto.com CEO Kris Marszalek has rejected comparisons to FTX, saying his company has a “very strong balance sheet.”
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