New South African Code Says Ads About Crypto Assets Must Include Capital Loss Warning – Africa Bitcoin News

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Crypto asset service providers in South Africa seeking to attract investors through advertisements must “expressly and clearly state that investing in crypto assets may result in a loss of capital.” Influencers working on behalf of crypto asset service providers must “not offer advice on trading or investing in crypto assets and may not promise any benefits or returns.”

The new code is the result of a collaborative effort between ARB and Crypto Entities

According to the latest code of practice published by the Advertising Regulatory Board (ARB) of South Africa, crypto-related advertisements must clearly warn the public that investing in digital assets “may result in loss of capital” . Additionally, ARB’s latest code states that the general wording of these advertisements must not contradict this disclaimer.

The new guidelines on advertising crypto assets, which is believed to be the result of the collaborative effort between the ARB and South African crypto exchanges, are apparently intended to prevent scammers from targeting their victims through regulated media platforms. Commenting on the inclusion of crypto assets in the latest ad code, Gail Schimmel, CEO of ARB, reportedly said:

It’s a wonderful example of an industry seeing the harm that could be done in its name and stepping up to self-regulate the issues without being forced into it by [the] government. This has been an exciting project and we know it will result in better protection for vulnerable consumers.

Meanwhile, in addition to the capital loss warning, the self-regulatory council wants advertisements to use language that is easily understood by the target audience. Regarding promises of future income or earnings, the new code stipulates that these advertisements must be supported “by adequate justifications in accordance with the requirements of clause 4.1 of section II”.

Similarly, advertisements referring to past performance must not be presented in a way that leaves a “favorable impression of the product or service advertised”.

When an influencer is hired or used to attract potential investors, the new code states that the person concerned must “share only factual information”. Additionally, Influencers and Project Ambassadors are not permitted to offer “advice on trading or investing in crypto assets and cannot promise any benefits or returns.”

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Terence Zimwara

Terence Zimwara is an award-winning journalist, author and writer in Zimbabwe. He has written extensively on the economic issues of some African countries as well as how digital currencies can provide an escape route for Africans.

Image credits: Shutterstock, Pixabay, Wiki Commons, Allen.G / Shutterstock.com

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