Cryptocurrency Project – winner of the Gold Award
28 February 2023
In the latest edition of the Best Practice Awards, the Gold Award went to the Advertising Standards Authority (ASA), the UK, for its Cryptocurrency Project. By developing principles for cryptocurrency advertising and drafting industry guidance, the project enforces compliance across the market, thus increasing the level of protection for vulnerable consumers.
About the project
Cryptocurrencies are largely unregulated by the UK’s statutory financial authority so responsibility for their advertising falls primarily to the ASA. The last few years had seen a dramatic increase in the volume of ads, especially online, as interest in cryptocurrency had gone mainstream both in the UK and globally. As cryptocurrency ads became more and more visible, there was increasing evidence that they presented a range of financial and social harms, and that inexperienced consumers were taking risks with highly volatile products leading to significant financial detriment.
The project started with the identification of a range of representative ads across multiple media platforms, for priority investigations. Decisions by the ASA Council, a jury with a majority involvement of independent, non-governmental lay persons, led to the publication of twelve rulings from December 2021.
The Committee of Advertising Practice published guidance on 10 March 2022 followed by an Enforcement Notice issued to 60 cryptocurrency firms on 22 March, providing advice and training to current and future industry practitioners in order to raise standards. The Enforcement Notice was followed by efficient compliance work, comprising data science-led monitoring and effective enforcement.
The new principles and guidance were created in a relatively short period with broad consultation with interested parties throughout the project and were intended to support advertisers and media owners to publish compliant ads, but also ASA case handlers, which therefore allowed for efficient and resourced administration of codes and prompt and efficient handling of complaints thereon.
Targeted interviews were held with a renowned financial publication during the project, which together with announcements at each stage, generated substantial media coverage in the UK and internationally. This, in conjunction with extensive engagement with the statutory regulator, UK trade association, media owners, cryptocurrency firms and other interested stakeholders, effectively raised awareness of the self-regulatory system amongst industry, consumers and other stakeholders.
Direct results and benefits
The project created awareness of the self-regulatory system across a newly emerging market generally only aware of the statutory requirements for financial promotions, and positioned the ASA as an actor in the vanguard to set rules for cryptocurrency ads. Moreover, this initiative created an increased willingness to start ASA-led investigations in the absence of consumer complaints, and learnings from the project paved the way to the administration of similar projects. Among other advantages, the ASA could also notice an increase in the understanding amongst its staff of the capabilities of the organisation’s relatively new Data Science function, and an increase in the skill set of staff to deliver high profile project work, as well as greater understanding of an emerging sector.
Last but not least, the project served as a good example that showcased the benefits of cross-departmental working, as the project team comprised members representing different functions within the organisation, and the expertise and perspective each brought from their areas of work helped immensely in delivering the project successfully.
In case you missed the news about the Best Practice Awards, you can find here the other winners. We will post a spotlight on their projects, keep an eye on EASA website!