New clause in South Africa’s advertising code for cryptocurrency
The Advertising Regulatory Board (ARB) in South Africa has introduced a new provision for the cryptocurrency business. This clause is intended to safeguard consumers against unethical advertising in the cryptocurrency industry.
A new clause was added to Section III of the advertising code for the nation of South Africa, and it stipulates that businesses and people in the country are required to comply by specific advertising standards relating to the offering of cryptocurrency-related goods and services.
‘Expressly and clearly’ stating that investments may result in the loss of cash “since the value is changeable and may go up as well as down” is something that all advertisements, including those for cryptocurrency offers, are required to do according to the first clause of the regulation.
In addition, advertisements indicating prospective investment losses must not contradict any cautions that are given.
It is essential that marketing communications for certain services and goods be presented in a way that is “clearly understood” to the target demographics.
Advertisements are required to provide statements that are fair and impartial on the returns, features, advantages, and dangers involved with the product or service being promoted.
Rates of return, predictions, or forecasts must also be fully supported, including a description of how they are computed and an explanation of what circumstances apply to the returns that are being promoted.
Any information referring to prior performance cannot be used to guarantee future performance or returns, and it should not be presented in a manner that generates “a favourable image of the marketed product or service.” [Case in point:]
It is inappropriate for advertisements placed by bitcoin service providers who are not also registered credit providers to promote the purchase of cryptocurrencies through credit.
Nevertheless, this does not stop service providers from promoting linked payment options that they provide to customers.
Additionally, it is going to be required of social media influencers and brand ambassadors that they will conform with particular advertising guidelines.
This includes the need that truthful information be shared, as well as the ban against giving advise on trading or investing in crypto assets and the prohibition against making claims of advantages or returns.