Site icon SCC Times

ASCI releases guidelines for advertising of virtual digital assets and linked services

On February 23, 2022, the Adverting Standard Council of India has released guidelines for advertising of virtual digital assets and linked services. The guidelines will be applicable to all advertisements released or published on or after the 1st of April 2022. Advertisers and Media owners must also ensure that all earlier advertisements must not appear in the public domain unless they comply with the guidelines, post the 15th of April 2022.

A Virtual Digital Asset (VDA) has been defined as any information or code or number or token (not being Indian currency or foreign currency), generated through cryptographic means or otherwise, by whatever name called, providing a digital representation of value exchanged with or without consideration, with the promise or representation of having inherent value, or functions as a store of value or a unit of account including its use in any financial transaction or investment, but not limited to investment scheme, and can be transferred, stored or traded electronically. These products are more commonly referred to as crypto products or NonFungible Tokens (NFTs).

 

Key points:

  1. All ads for VDA products and VDA exchanges, or featuring VDAs, must carry the following disclaimer.

    “Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions.”

  2. The words “currency”, “securities”, “custodian” and “depositories” may not be used in advertisements of VDA products or services as consumers associate these terms with regulated products.
  3. The information contained in advertisements shall not contradict the information or warnings that the regulated entities provide to customers in the marketing of VDA products from time to time.
  4. Advertisements that provide information on the cost or profitability of VDA products shall contain clear, accurate, sufficient and updated information. For example, “zero cost” will need to include all costs that the consumer might reasonably associate with the offer or transaction.
  5. Information on past performance shall not be provided in any partial or biased manner. Returns for periods of less than 12 months shall not be included.
  6. Every advertisement for VDA products must clearly give out the name of the advertiser and provide an easy way to contact them (phone number or email). This information should be presented in a manner that is easily understood by the average consumer.
  7. No advertisement for VDA products or exchanges may show a minor, or someone who appears to be a minor, directly dealing with the product, or talking about the product.
  8. No advertisement may show that VDA products or VDA trading could be a solution to money problems, personality problems or other such drawbacks.
  9. No advertisement shall contain statements that promise or guarantee future increase in profits.
  10. No advertisement may show that understanding VDA products is so easy that consumers do not have to think twice about investing. Nothing in the ad should downplay the risks associated with the category.
  11. VDA products may not be compared to any other asset class which is regulated.
  12. Since this is a risky category, celebrities or prominent personalities who appear in VDA advertisements must take special care to ensure that they have done their due diligence about the statements and claims made in the advertisement, so as not to mislead consumers.
Exit mobile version