Advertising of virtual currencies is largely contributing to these products becoming increasingly familiar to a wide audience, however, they fail to warn people of the risks involved. New rules will come into force to better inform consumers.
From Bitcoin to Ether, cryptocurrencies are being promoted through advertising campaigns on the internet, but also on billboards on city streets and on shirts of certain international sports clubs. The current lack of regulations means ads barely mention the risks involved with trading these coins, and in some cases, allow rogue actors in the market to target vulnerable people by taking advantage of their lack of knowledge.
"Virtual currencies are becoming more and more ingrained in our society. It is important that those who invest in virtual coins with the best intentions are sufficiently aware of the high risks involved," said Vincent Van Peteghem, Minister of Finance, stressing that financial dramas must be avoided.
While the government is not looking to ban virtual coins, it argued that stricter rules and rigorous controls are necessary. "We should expect that advertising can be done in full transparency. This is in the interest of consumers," Van Peteghem added.
Risk is only guarantee
As virtual currencies are easy to create and spread in the market, they have a highly unpredictable value, meaning prices can either skyrocket in an upward direction or crash without warning or any change in the "real" economy.
The new royal decree on this sector will ensure that every advertisement will include a warning on the unreliable nature of this investment which states: "Virtual currencies, real risks. The only guarantee in crypto is risk."
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Other concrete measures are also set out, including that advertising should also comprehensively mention all the potential risks that consumers may face by investing in virtual coins, and if a well-known person is included in the ad, it must be clearly stated that the person receives compensation.
The financial watchdog FSMA will strictly monitor whether the rules are being followed to ensure virtual coin advertising is not misleading or inaccurate.
