Tuesday, February 7, 2023
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South Africa Introduces Cryptocurrency Advertising Code

The Advertising Regulatory Board (ARB) of South Africa has inserted a new section for the cryptocurrency business to safeguard consumers from unethical advertising.

In a new section added to Section III of the country’s advertising law, companies and individuals in South Africa must follow specific advertising standards relevant to the offering of bitcoin goods and services.

The first section states that advertisements, including cryptocurrency offers, must “expressly and clearly” disclose that investments may result in capital loss “since the value is changeable and may go up as well as down.” Advertisements must also not contradict warnings about possible investment losses.

Advertising for specific services and goods must be conveyed to targeted audiences in a ‘clearly understood’ way. Advertisements must also provide balanced messaging about the connected product or service’s returns, features, advantages, and dangers.

Return rates, estimates, or forecasts must also be fully supported, including how they are computed and what criteria apply to stated results. Any information referring to prior performance cannot be used to guarantee future performance or returns, and should not be provided in such a manner that it produces a ‘favourable picture of the marketed product or service.’

Advertisements from cryptocurrency service providers that are not registered credit providers should not promote the use of credit to purchase cryptocurrencies. This does not, however, restrict service providers from promoting connected payment options.

Social media influencers and brand ambassadors will also be required to follow specific advertising guidelines. This includes being obliged to disclose accurate information while being barred from giving trading or investment advice in crypto assets, as well as being prohibited from making claims of advantages or returns.

The initiative was driven by cryptocurrency exchange Luno, a well-known South African service provider. According to Marius Reitz, Luno’s GM for Africa, the exchange sought the regulatory body to draft new standards with important stakeholders in the local crypto business.

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Jeewan Singh is CryptoShrypto’s content writer and a seasoned writer with over two years of experience in writing about Indian Securities Market. Jeewan's participation in Blockchain and Cryptocurrency started in late 2020, and he hasn't looked back since. The technical and economic outcomes of cryptocurrency are what spark his curiosity, and he keeps one eye on the market.
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