- Social networks allowed misleading crypto asset ads to multiply
- BEUC requests stricter advertising policies and their enforcement
European consumer organization BEUC and some of its member-countries (France, Denmark, Greece, Italy, Spain, Slovakia, Lithuania, and Portugal) filed a complaint with the European Commission (EC) against YouTube, Instagram, TikTok and Twitter for enabling misleading crypto promotion, BEUC posted on its website.
Misleading ads incur financial harm
The complaint alleges that the social networks are responsible for allowing misleading crypto asset advertisements to multiply through influencers and ads. This is an unjust commercial practice, which exposes users to great potential damage, such as losing a lot of money.
According to BEUC, crypto isn’t backed by tangible assets like traditional investments and its inherent volatility is a risk. The organization published a report titled ‘Hype or harm? The great social media crypto con’, which provides evidence that Instagram, YouTube, TikTok and Twitter enabled misleading promotions that violated their own advertising policies.
Stricter policies and measures requested
BEUC calls on the Consumer Protection Cooperation Network to request stricter advertising policies on social media, as well as their enforcement. They ask for measures to prevent influencers from misleading consumers and for the EC to be informed about how effective consumer protection measures are.
BEUC Director General Monique Goyens summarized:
Consumers are increasingly being promised ‘get rich quick’ investments by ads and influencers on social media. In most cases, these claims are too good to be true and consumers are at a high risk of losing a lot of money without recourse to justice. Crypto will be regulated soon with the new Market in Crypto Assets Regulation but this legislation does not apply to the social media companies benefiting from the advertising of crypto. This is why we are turning to the authorities in charge of protecting consumers to ensure Instagram, YouTube, TikTok and Twitter fulfil their duty to protect consumers against crypto scams and false promises.
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