Advertising Stands Council of India (ASCI) has released official crypto guidelines for advertising and they will be applicable from April 1, 2022. All the companies have been directed that advertisements made in the past should not be broadcasted in any public domain unless they comply with guidelines after April 15, 2022.
The guidelines have been framed after discussions with stakeholders from virtual digital asset industry and government of India. ASCI was established in 1985, and is responsible for regulations in Advertising to protect the best interest of consumers in Indian market. It was formed with support from Advertising Agencies, Advertisers, PR Agencies and Market Research Companies.
Chairman of ASCI Subhash Kamath said, “We had several rounds of discussion with the government, finance sector regulators, and industry stakeholders before framing these guidelines. Advertising of virtual digital assets and services needs specific guidance, considering that this is a new and as yet an emerging way of investing. Hence, there is a need to make consumers aware of the risks and ask them to proceed with caution”.
Secretary General of ASCI Manisha Kapoor said, “We have seen a spate of advertising for virtual digital assets which could compromise consumer interest in the absence of some guardrails. Use of celebrities and high decibel advertising would attract consumers to these offerings, without full disclosure of the risks. Given that this is, as of now, an unregulated space, it is even more important for advertising to be upfront regarding the risks associated with these products. Globally, this is an emerging technology and products in the virtual digital asset industry have seen significant volatility. We believe with these guidelines, advertisements would be fairer and more transparent.”
Let’s look at Crypto Guidelines For Advertising issued by ASCI in bullet points;
- All the ads for Virtual Digital Assets products and exchanges or just featuring VDA in any form should have following disclaimer attached to it: “Crypto products and [non-fungible tokens] are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions.”
- The guidelines have made it clear that VDA products ads should not contain words ‘securities, currency, depositories, custodian’. This is because these words can only be used for regulated products and services.
- Guidelines also have made it mandatory to mention clear, accurate, updated and sufficient information when talking about cost or profitability of VDA. For instance, ‘Zero Cost’ should contain all the cost that associate with the transaction of VDA.
- All the advertisements should have ‘returns for periods of less than 12 months shall not be included’ mentioned to make sure that ‘information on past performance shall not be provided in any partial or biased manner.’
- ASCI stated that currently many crypto-related advertisements do not disclose the risks that are associated with Virtual Digital Assets.
A meeting was held in November which was chaired by Prime Minister Narendra Modi on regulatory prospects of crypto. The main highlight of the meeting was that Indian Youth is currently misled by non-transparent and over promising advertising.