The Indian advertising regulator has released official guidelines for the promotions of cryptocurrencies across all channels. Most of the requirements were around providing risk warnings and pointing out the unregulated nature of the investment products.
All crypto ads targeted to the Indian audiences must contain a clear disclaimer: “Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions.”
The placement of this disclaimer depends on the nature of the promotion and its length.
Further, Indian cryptocurrency exchanges cannot use four terms in their promotions as these are associated with regulated products. These terms are 'currency', 'securities', 'custodian' and 'depositories'.
These guidelines were prepared by the ads regulator of the country, Advertising Stands Council of India (ASCI), after consultation with multiple stakeholders.
“We had several rounds of discussion with the government, finance sector regulators, and industry stakeholders before framing these guidelines,” said ASCI's Chairman, Subhash Kamath.
Too Strict?
Additionally, the crypto ads campaigns will need to propagate the cost or profitability information of the virtual digital asset products, meaning 'zero cost' will need to include all costs that the consumer might reasonably associate with the offer or transaction.
Also, the companies cannot include crypto returns of the past 12-months in the promotions and cannot compare digital assets with other regulated products.
“If we look at the existing crypto advertisements, they are already carrying risk-related disclaimers for the investors as mentioned in the latest ASCI guidelines,” Buyucoin’s CEO, Shivam Thakral said. “The advertising guidelines are based on our current understanding of the crypto ecosystem and are expected to evolve as the industry enters a more mature phase.”
The Indian government decided to impose a flat 30 percent tax on gains from April 1, but the asset class still remains unregulated in the country. An upcoming bill, the exact contents of which are still unknown, will determine the final fate of cryptocurrencies in the country.
