Spain Regulates Cryptocurrency Advertising Procedures, Investment Risks Must Be Explained

JAKARTA – The Spanish government began moving on Monday, January 17 to regulate the increasingly rampant advertising of crypto assets, including by social media influencers. They tasked stock market watchdogs with authorizing mass campaigns and making sure investors were aware of the risks.

The rapid growth of cryptocurrencies and digital assets pegged to traditional currencies has caught the attention of regulators around the world, who fear they could harm financial systems if not monitored.

The Spanish government said in its official bulletin, advertisers and companies marketing crypto assets must notify the CNMV watchdog at least 10 days in advance of the content of campaigns targeting more than 100,000 people.

The new regulations will begin in mid-February and allow CNMV to specifically monitor advertisements for all types of crypto assets and include warnings about the risks involved in such investments.

The rules also apply to crypto asset service providers when advertising their activities and to anyone advertising themselves or on behalf of third parties.

This includes influencers with over 100,000 followers who are paid to advertise and promote crypto assets. CNMV also added that they should notify the supervisor of the promotion post and warn of the risk.

In November 2021, CNMV rebuked soccer star Andres Iniesta after he promoted cryptocurrency exchange platform Binance on his Twitter and Instagram accounts. They told the former Barcelona player that he should be thoroughly informed about cryptocurrencies before making any investments in them or recommending others to do so.

Cryptocurrencies like bitcoin have experienced very high price volatility accompanied by a significant increase in aggressive advertising to attract investors around the world.