UK advertising body upholds complaint against Crypto Bank Global

Maria Nikolova

The ASA has found that a newspaper ad by Crypto Bank Global is misleading.

The UK Advertising Standards Authority (ASA) has upheld a complaint targeting a newspaper ad by Inside Access LLC t/a Crypto Bank Global, finding the ad was in breach of the CAP Code.

The ad in question appeared in the April 30, 2018 edition of a regional newspaper. Text in the ad stated “bitcoin to hit £30,000 in 2018! FREE CENTRAL LONDON SEMINAR … There are more millionaire’s being made from Bitcoin faster than anything in history. DON’T miss your chance AGAIN! Come to our FREE London Seminar and learn how you can make money in Bitcoin”.

The complaint by Barclays Corporate Banking challenged whether:

  • 1. the claim “bitcoin to hit £30,000 in 2018” was misleading; and
  • 2. the ad was misleading, because it did not make clear that bitcoin was an unregulated financial product.

In its ruling, made public earlier today, the ASA explains that Inside Access LLC acknowledged receipt of the complaint but did not provide a substantive response.

The ASA was concerned by Inside Access LLC t/a Crypto Bank Global’s lack of response and apparent disregard for the Code, which was a breach of the CAP Code (Edition 12) rules 1.7 (Unreasonable delay). The body reminded the firms of their responsibility to provide a substantive response to enquiries.

The ASA upheld the complaint. Elaborating on the reasons for its decision, the body said that whereas some consumers might have a degree of knowledge concerning cryptocurrencies, most were unlikely to be familiar with the workings, and therefore the associated risks of cryptocurrencies such as Bitcoin. The ASA considered that those consumers would understand that the ad related to a seminar for a form of financial investment.

The ASA believes that consumers are likely to understand from the claims in the ad that the value of the cryptocurrency would significantly increase in 2018 (potentially reaching 1 Bitcoin to £30,000) and any investment was guaranteed to result in swift and substantial profit.

Although the ad was for a seminar about investment in Bitcoin, because the ASA understood that Crypto Bank Global offered services that facilitated investment in cryptocurrencies, the body considered that the potential risk of fluctuation in the value of Bitcoin to be material information that consumers required in order to make an informed decision about the seminar.

Because the ad implied that the value of Bitcoin would continue to rise significantly in 2018 and that rapid and substantial investment return would be guaranteed, and that the ad did not make clear that the value of Bitcoin could go down, as well as up, the ASA ruled that the ad was misleading.

On that point, the ad breached CAP Code (Edition 12) rule 3.1 and 3.3 (Misleading advertising).

The ASA also voiced its concerns that because of the ad, consumers would expect the investment in Bitcoin to be regulated, and there would be legal protection in place for related investment activities. But Bitcoin is not currently regulated within the UK and consumers could not therefore seek recourse to services such as the Financial Services Compensation Scheme or the Financial Ombudsman Service.

For those reasons, the ASA found the fact that Bitcoin is currently unregulated, to be material information that consumers require in order to make informed decisions about the seminar, and therefore should have been made clear in the ad.

On that point, the ad breached CAP Code (Edition 12) rules 3.1 and 3.3 (Misleading advertising) too.

The ASA ruled that the ad must not appear again in the form complained of. The body told Crypto Bank Global to ensure that future ads did not misleadingly imply that the value of Bitcoin, or any other cryptocurrencies, would rise significantly, and that fast and substantial investment returns would be guaranteed.

The ASA also instructed Crypto Bank Global to ensure that those ads also made clear that the value of Bitcoin, or any other cryptocurrencies, could go down as well as up, and that it was an unregulated financial product.

Read this next

Retail FX

Interactive Brokers doubles client accounts to 2 million in 24 months

Electronic brokerage firm Interactive Brokers LLC (NASDAQ:IBKR) said its trading volumes took a slight step back in September, an indication that investor confidence is still fairly mixed over the past few months.

Digital Assets

DeFiChain tokenizes Walmart, Unilever, US Oil and Gas Funds

Bitcoin-based DeFi platform DeFiChain is opening up the opportunity for its users to trade crypto versions of Walmart, Unilever, US Oil Fund, and US Gas Fund.

Industry News

The B2Broker B2Core REST API Is Now Live

B2Broker has announced the release of its new REST API, which lets customers use B2Broker’s solutions and services for business purposes.

Executive Moves

CME Group taps Paul Woolman to lead Equity Index, Giovanni Vicioso to lead Crypto

“Our equity and cryptocurrency businesses have experienced tremendous growth in recent years, underpinned by strong customer adoption and continued innovation.”

Technology

Sumsub launches document-free KYC for users in India, Brazil, Nigeria and Indonesia

Sumsub has launched one click-KYC for users in India, Brazil, Nigeria and Indonesia in a move that allows businesses to instantly onboard over 2 billion users without requesting their ID documents.

Digital Assets

Cboe becomes first major global exchange operator on DeFi data platform, Pyth Network

“Our participation in the Pyth network will provide another avenue to broaden customer access to our data, and aligns with our strategy to deliver market data to investors around the globe based on how they want to consume their data, whether through direct connectivity methods, the cloud or the blockchain.”

Industry News

FINRA fines Barclays Capital $2 million for best execution failures for 5 years

FINRA has fined Barclays Capital $2 million for failing to comply with its best execution obligations in connection with its customers’ electronic equity orders between January 2014 and February 2019. 

Digital Assets

SETL helps SWIFT, CSDs and custodians develop common framework for tokenisation systems

London-based enterprise DLT and blockchain company SETL has delivered a pilot project for SWIFT which implemented a common framework linking tokenisation systems between central security depositories (CSDs) and global custodians.

Digital Assets

Crypto volumes hit CHF 87.1 million at Switzerland exchange

Switzerland’s principal exchange has experienced a rebound in trading activities for September 2022, with monthly volumes increasing by more than 20 percent MoM.

<