ASCI has released new guidelines for advertising digital financial instruments such as cryptocurrency and NFTs, here are some insights by industry leaders on what lies ahead, with some tips on how to incorporate the guidelines.
India reportedly has the highest number of cryptocurrency owners in the world accounting for an estimate of 10 Cr investors, although credibility, reliance, legality, and more of such factors remain variable and uncertain. On the other side, interactions on social media about the financial instrument have been escalating since 2013. This upward trend has contributed to several crypto brands emerging and heavily marketing their products and services. With this ASCI has released Guidelines for Cryptocurrency.
While the number of marketing campaigns increased, it was noted that several of these advertisements do not adequately disclose the risks associated with such products.
ASCI has addressed these concerns in the consumers’ interest through a new set of guidelines. The Advertising Standards Council of India (ASCI) guidelines for advertising virtual digital assets applicable to all virtual digital asset-related ads released on or after 1st April 2022.
Overview Of The Guidelines
- The guidelines make it mandatory for any such ads to carry a disclaimer of “Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions”
- The disclaimer must be made in a manner so that it is prominent and unmissable by an average consumer
- In social media posts, specifically, such a disclaimer must be carried in both- the caption as well as any picture or video attachments
- Celebrities or prominent personalities who appear in virtual digital assets advertisements must take special care to ensure that they have done their due diligence about the statements and claims made in the advertisement, so as not to mislead consumers
- The guidelines will be applicable to all advertisements released or published on or after the 1st of April 2022. Advertisers and media owners must also ensure that all earlier advertisements must not appear in the public domain unless they comply with the guidelines, post the 15th of April 2022
Manisha Kapoor, Secretary-General, ASCI, added, “We have seen a spate of advertising for virtual digital assets which could compromise consumer interest in the absence of some guardrails. The 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”.
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Industry Professionals React…
Sharing his thoughts on the guidelines, Chetan Asher, Founder & CEO, Tonic Media states “It’s an emerging category and there is much regulatory confusion around it. Consumers too may not fully understand the category and may interpret the communication that VDAs promise assured profits. These guidelines will lead to change in the communication approach and put the onus on educating the consumer, which will only help the category overall”.
Akshay Gurnani, Co-Founder & Chief Executive Officer, Schbang reckons, “Regulation is a step in the right direction as it puts the onus on the consumers to think, pick & choose while purchasing or selling crypto thus allowing the consumers to diversify their portfolio. With more people entering the space to invest, the regulation from ASCI helps in driving onus back to the consumer on whether they should be taking risks in a volatile market or not”.
Lloyd Mathias, Business Strategist, and Independent Director believes, “What is laudable is that a self-regulating advertising body is doing this, even before regulations governing this asset class have been framed by financial authorities. Many of these virtual digital assets are volatile and the campaigns could be misleading and entice retail investors to compromise consumer interest.
Challenges That Come Along…
Chaitanya Joshi, Senior Creative Director, Dentsu Webchutney mentions, “It is, of course, going to be challenging to accommodate it in some formats. We just have to be smart about the assets we use while approaching the brief. More motion formats might help”.
Sahil Shah, Managing Partner, WATConsult shares “Some form of guideline and direction in this ever-evolving space at least puts everyone in line, which is a good thing. What is not so good is that the IPL season starts soon and a lot of advertisers would have already planned or made their creative, which now, will need some round of changes. But overall, we were expecting this and it was needed to protect consumer interests at large”.
Mathias shares that as ASCI is not a statutory body, he hopes there is escalation to a governmental authority so that any advertiser/endorser that ASCI calls out for flouting these rules is held accountable.
Tips For Brands & Agencies
Here are a few tips by the experts on how to efficiently and effectively follow the guidelines without limiting creative communication:
- Use your assets efficiently, motion formats might help
- Brands and agencies should actively adopt the inclusion of signals and warnings to protect consumer interests
- Hold in-house trainings/sessions to make the talent pool well-versed about the guidelines
- Make informed decisions on the changes to be made on new and existing content
- The guidelines guidelines should be followed in the spirit to ensure that consumers understand their proposition and the risk associated with it fully