Central Bank of Ireland Issues Warning Regarding Crypto-related Ads

On Tuesday, a warning was issued to consumers by the Central Bank of Ireland regarding the risks surrounding crypto investments as well as “misleading”  advertisements such as those posted by social media influencers. This move forms part of a European-wide campaign organized by the European Securities and Markets Authority, the European Banking Authority, and the European Insurance and Occupational Pensions Authority — collectively regarded as the European Supervisory Authorities.

Cryptocurrencies are considered to be “highly risky and speculative” for retail investors, according to the Central Bank of Ireland, which also urged individuals involved in the industry to be cautious of “the risks of misleading advertisements, particularly on social media, where influencers are being paid to advertise crypto assets.”

“In Ireland and across the EU we are seeing increasing levels of advertising and aggressive promotion of crypto-asset investments,” explained the central bank’s director general of financial conduct Derville Rowland. “Before you buy crypto assets, you need to think about whether you can afford to lose all the money you invest […] People should also be aware that if things go wrong, you do not have the protections you would have if you invested in a regulated product.”

The notice follows similar stances made by global regulators and lawmakers who have started to crack down on influencers promoting cryptocurrencies. The Spanish government had implemented regulations for crypto advertisements earlier in January which specifically included “products or services promoted via influencers.” Crypto firms have also been repeatedly warned by the Advertising Standards Authority of the United Kingdom regarding violations of advertisements dealing in digital assets.

Several celebrities and influencers have likewise been linked to plenty of initial coin offering scams in the United States. Additionally, in June 2021, Kim Kardashian posted about the ERC-20 token EthereumMax (EMAX) on her Instagram story which spiked the price but quickly fell by 99%, leaving many investors at the losing end.

Despite Ireland’s regulations on cryptocurrencies, several firms are still establishing operations within the country. For instance, the crypto exchange Gemini had just received its license from the central bank to provide electronic money services after its operations in Dublin first opened in early 2021. Crypto firms Ripple and Kraken, on the other hand, have chosen Ireland to be their base of operations in Europe, while Binance had also set up three subsidiaries in Ireland in September 2021.

Source: CoinTelegraph