Copywriters and sellers beware: there could be a new set of regulations coming to cryptocurrency advertisements. As many crypto companies go bust, Congress is looking to warn potential customers about the risks of investing by adding more transparency to the category. Cryptocurrency scams, promising significant returns, have become a preferred method for scammers, with approximately one billion dollars lost to cryptocurrency fraud last year.
The Responsible Digital Asset Advertising Act calls for crypto companies to disclose financial compensation given to influencers and celebrities for promoting crypto assets, which would include on-air talent. Other stipulations of the act would make advertisers add a disclaimer saying that past crypto performance is not indicative of future returns and disclose all hidden fees and charges.
Violations would result in fines of up to $100,000 for first offenses and $1 million for subsequent violations. Violators may also face potential restrictions on selling crypto assets in the future. While the bill has yet to be introduced in the House, the Federal Trade Commission (FTC) has been investigating potential misconduct by crypto companies and cracking down on fraudulent practices.
— Radio Ink
