UK-based advertising authority punished Arsenal FC football club on August 10 for not warning the users of the risks involved in the cryptocurrency investment in its “fan token” advertising campaign.
In spite of an appeal, The Advertising Standards Authority (ASA) has maintained its decision against the football League Club for the two advertisements of fan tokens falling short of regulator standards.
In the first advertisement, a website published a post on August 6, 2021, giving information about the token and guiding how it could be used in the Socios app.
The second advertisement is of a Facebook post featuring some of the Arsenal footballers promoting the token which was published on 12 August 2021.
Moreover, ASA noticed that the Facebook post doesn’t clarify that tokens are crypto assets and forgot to mention that for purchasing the $AFC token, fans are required to have both an exchange account and $CHZ cryptocurrency.
Additionally, the two adverts were observed to be: “misguiding, as they failed to mention the risks involved in the investment,” and “irresponsible, by taking advantage of user inexperience” in the crypto investing domain.
Apart from this ASA also concluded that the ads were irresponsible and breached the code of conduct by not making clear the capital gains tax (CGT) that is payable on profits by selling the fan token.
Now, the ASA has decided that the adverts, “should not show up again in the form of complained about.”
The regulatory authority also urged Arsenal to do the following:
- Make clear to fans that the fan token investment involves risk and is an unregulated asset.
- stop misleading the users by forgetting to mention information like purchasing the fan token, users need to open a crypto exchange account and buy cryptocurrency.
- In future ads, make sure to mention the risks and not take advantage of users’ inexperience.
In response to the ASA decision, Arsenal appealed and said that the warnings it gave were enough and the user know the cryptocurrency risks.
Moreover, Arsenal said in the statement that “We are sad by the ASA’s choice to maintain their decision even after our appeal. We have agreed with the ASA’s direction since the first decision, and we will continue to comply in our future communications in this fast-moving area.”