The Advertising Standards Council of India has issued a comprehensive guideline for advertisements of digital assets and crypto businesses, including exchanges and NFTs.
The ASCI said that the guidelines will be enforced from April 1, 2022, and advertisers must ensure that their previous ads don’t appear in the public domain without the new disclaimer.
Ads Must Have a Disclaimer
The local watchdog asked in the guidelines that crypto ads display a disclaimer that these “unregulated” products can be “highly risky” as there can be no regulatory recourse in case of any loss.
“Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions.”
The ASCI guideline asked crypto businesses to carry this disclaimer prominently in the ads they put out on the media.
The ASCI is a self-regulatory body of the Indian advertising industry. The organization has made it clear that its guidelines shouldn’t be mistaken as “legal recognition or endorsement of the industry or the sector.”
Details From the ASCI Guidelines
The ASCI noted that advertising of such assets “has been very aggressive over the past few months,” even as the Indian government is trying to come up with a legal framework for this sector. Many of these ads don’t “adequately” reveal the risks associated with these products. There is no mechanism to ensure they don’t “mislead or exploit” the consumers.
“ASCI has extensively consulted with different stakeholders including government and the virtual digital asset industry – to frame guidelines for virtual digital asset advertising,” it said about the process of crafting the guidelines.
Among other necessary regulations, the institutions asked crypto businesses not to present a comparison of virtual digital assets with any other regulated assets.
Manisha Kapoor, Secretary-General, ASCI, said: “Globally, this is an emerging technology, and products in the virtual digital asset industry have seen significant volatility. We believe with these guidelines, advertisements would be fairer and more transparent.”
Guidelines Echo With Official Sentiments
Earlier, in the budget proposals tabled in parliament on February 1, the Indian government proposed to levy a 1% tax deduction at source (TDS) on all crypto transactions and a flat 30% on all such profits. It also announced the launch of its official digital currency, a CBDC, in the next fiscal.
However, the stance of the Indian government or the central bank on digital assets has not changed. Recently, a top Reserve Bank of India official claimed that cryptocurrencies should be banned as they are like Ponzi schemes posing a threat to financial stability while having no intrinsic value.