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Friday, February 3, 2023

US consumer watchdog probes crypto firms over deceptive ads

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Several crypto firms are going through a probe from the United States Federal Trade Commission (FTC) over potential deceptive or deceptive commercials regarding cryptocurrencies.

According to a Dec. 6 report from Bloomberg, FTC spokeswoman Juliana Gruenwald mentioned the watchdog is investigating “several firms for possible misconduct concerning digital assets.”

Gruenwald didn’t present additional particulars about which firms have been the topic of the investigation or what had triggered the probe.

However, deceptive promoting and promotion have been a trending matter within the U.S. this yr.

In October, actuality TV star Kim Kardashian was fined by the United States Securities and Exchange Commission (SEC) for “touting on social media” in regards to the EthereumMax (EMAX) crypto token with out disclosing she was paid $250,000 to put it up for sale.

In November, NFL quarterback Tom Brady and NBA level guard Stephen Curry have been reportedly amongst a gaggle of celebrities going through a probe from the Texas financial regulator over their promotion of the now-bankrupt crypto trade, FTX.

The FTC is an impartial company of the United States which was created to guard the general public from deceptive or unfair enterprise practices by legislation enforcement, analysis, and schooling. 

Earlier this yr, they despatched out an alert about a crypto scam with three key parts, an impersonator, a QR code and a crypto ATM the place the victims will probably be directed to ship cash.

They additionally revealed in a Jun.6 report almost half of all crypto-related scams originated from social media platforms in 2021, and as a lot as $1 billion in crypto has been misplaced to scammers all year long.

Cointelegraph reached out to the FTC for remark however didn’t obtain a reply by the point of publication.

Related: Saying ‘not financial advice’ won’t keep you out of jail — Crypto lawyers

Globally, a number of monetary watchdogs and enforcement companies have additionally been actively making an attempt to curb deceptive crypto advertisements.

In March, the U.Okay.-based Advertising Standards Authority (ASA) issued an enforcement discover to over 50 corporations promoting crypto, instructing them to assessment their ads to make sure they adjust to the principles.

In August, the U.S.-based consumer watchdog group Truth in Advertising called out 19 celebrities for allegedly selling nonfungible tokens (NFTs) with out disclosing their connection to the initiatives.

Australia’s monetary regulator has additionally fired warning photographs throughout the crypto business about deceptive promoting ways.

In October, the Australian Securities and Investments Commission (ASIC) launched civil proceedings towards Australian agency BPS Financial Pty Ltd (BPS) over alleged “misleading” representations regarding its Qoin token.