Delhi High Court has issued a notice on the plea filed against cryptocurrency advertisements in India; the court has asked concerned regulatory bodies to take note of the matter and issue guidelines for standardized disclaimers on the ads in the public interest.
The Divisional Bench of Justice DN Patel and Justice Jyoti Singh has notified the Securities and Exchange Board of India (SEBI), the Ministry of Information and Broadcasting, M/s Wazir X, M/s CoinDCX, and M/s Coinswitch Kuber, directing them of compulsory guidelines for all crypto advertisements broadcasted in India.
Standardized Font Size of Disclaimers
The plea claimed that crypto assets’ are volatile in nature, and pose an increased likelihood of risky outcomes upon investment, compared to traditional investments. Moreover, the current disclaimers on advertisements of these risky digital assets are too small to read and need to be broadcasted in a standard size.
The standard size disclaimer shall read, “Cryptocurrency is an unregulated digital currency, not a legal tender and subject to market risk.”
Voice-Over and other aspects stated in the Plea
Along with the inclusion of standard size the plea has also requested a voice-over of the disclaimers in case the ad is cut too short in duration and people are unable to read the full text as quickly. Full disclosure system shall be followed with cryptocurrency ads, same as mutual funds.
“An ordinary retail investor who views the audio-visual advertisement on television run by the films involved on a regular basis, as well as on online websites like YouTube, may suffer immense losses as a result of thereof whilst on the other hand; having a disclaimer on screen after the end of the advertisement with voice over in English and Hindi (as may be appropriate) and correct placing and at least 80 percent coverage in terms of the size on the screen to be viewable and readable by the investor, may instill wisdom of researching and reading up on the risk profiles surrounding crypto-assets prior to investing his hard-earned money in digital assets not understood by him.”, stated the Plea filed by Petitioners Ayush Shukla and Vikash Kumar, who are both practicing lawyers. (ANI)
UK Crypto Ads crackdown
A similar crackdown campaign on crypto ads has been initiated in London. UK watchdog, the Advertising Standards Authority (ASA) announced a crackdown on misleading crypto ads throughout the nation, on 9th July. Director of complaints and investigations at the ASA, Miles Lockwood claimed that crypto ads are a “red alert” priority, as they pose a potential threat to the less aware and vulnerable audience of financial promotions.