Major Social Media Platforms Now Facing Complaints From BEUC Due To Misleading Crypto Asset Promotion

Sophia Cruz•Monday, June 12, 2023•1 min read

Major social media platforms namely Instagram, TikTok, YouTube, and Twitter are now facing potential regulatory action in the European section after the European Consumer Organization (BEUC) filed a complaint for misleading promotion of crypto assets.

BEUC, an umbrella organization of European consumer groups has also requested the Consumer Protection Cooperation Network more strict advertising policies and enforcement on these social media platforms in terms of promoting, marketing, and advertising cryptocurrency.

In addition, the group also suggested adoption measures to prevent content creators and influencers from misleading consumers about the nature of specific crypto and called for cooperation between European consumer authorities and European Supervisory Authorities for financial services to ensure that platforms follow advertising policies.

The complaint was filed following the SEC lawsuit against Coinbase, Binance, and FTX collapse last year. The BEUC complaint was signed by various consumer groups across the European region including France, Greece, Denmark, Italy, Lithuania, Slovakia, Spain, and Portugal.

In response to the complaint, the European Union has issued the world’s first comprehensive set of rules for crypto asset regulation, also known as MiCa. However, BEUC insists that the legislation does not apply to social media companies that benefit from advertising crypto assets.

Meanwhile, tougher rules for crypto services advertisers starting October 8 say the Financial Conduct Authority (FCS). The rules include a 24-hour cooling-off period for first-time crypto investors under these new marketing rules. In addition, “refer a friend” bonuses for crypto buyers will be banned and digital assets promoters will have to include clear risk warnings and make sure that their ads are clear, fair, and not misleading.

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ABOUT THE AUTHOR See More

Sophia Cruz

Financial Writer - Asian & European Desks

Sophia is an experienced writer, reporter and newsdesk member, mostly on the financial sectors. For the past 5 years Sophia has covered a wide variety of topics such as the financial markets, economics, technology, fin-tech and trading. Sophia has been a part of the FX Leaders team since 2017 and works on producing valuable content and information for traders of all levels of experience.