New Crypto Rules Added to South African Advertising Code

Advertising Regulatory Commission (ARB) seeks to protect consumers by adding a new provision to its Advertising Practice Standards dealing with cryptocurrency products.

“The new rules are intended to protect consumers from being misled by unethical advertisers and are the result of consultations and agreements with the cryptocurrency industry,” ARB said in a statement on Monday.

ARB CEO Gail Schimmel said, “This is in the name of recognizing the possible harm and stepping up to self-regulate the issue without government coercion.” A great example for the industry.

Cape Town-based cryptocurrency exchange Luno spearheaded the project. Marius Reitz, General Manager, Africa, said: We don’t want dishonest advertisers making claims that mislead vulnerable consumers about the realities of cryptocurrency investing. ”

The updated Advertising Code of Practice states:

• Advertisements must explicitly and clearly state that investments in crypto assets can fluctuate in value, go up and down, and may lead to loss of capital. The wording should be the same as the following example. “Investing in crypto assets can lead to loss of capital.”
• The overall message of your ad must not contradict the warning text above.
• Advertisements for specific cryptocurrency services or products must describe the relevant product or service in a way that is easily understood by the intended target audience.
• Advertisements should provide a balanced message about returns, features, benefits and risks associated with the product or service.
• Rates of return, projections and forecasts must be backed up by appropriate evidence. You need to communicate the rate of return, forecast, or how the forecast is calculated and what key conditions apply.
• Information about past performance should make it clear that past performance is not indicative of future performance. Past periods or past performance should not be presented in a manner that gives a favorable impression of the advertised products or services.
• Advertisements by cryptocurrency service providers that are not registered credit providers should not encourage the purchase of cryptocurrency on credit. This does not prevent advertisements from providing information about payment methods offered by cryptocurrency service providers.
• If influencers or ambassadors are used to promote cryptocurrency products or services, they may only share factual information. Influencers and ambassadors may not offer advice or promise profits or benefits regarding trading or investing in cryptocurrencies.

The Advertising Regulatory Commission was established by the marketing and telecommunications industry to protect South African consumers through self-regulation of advertising. ARB’s founding members are the South African Marketing Association, the Association for Communications and Advertising, and the Internet Advertising Bureau (IAB). – © 2023 News Central Media

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