An advertisment by crypto exchange Coinfloor has been banned by the UK Advertising Standards Authority (ASA) for “irresponsibly” promoting as an investment to pensioners.
The advert, in a December edition of local paper the Northamptonshire Telegraph, featured a testimonial from a 63-year-old woman who invested her pension money into Bitcoin and used the exchange’s service to buy the asset “automatically straight from my bank account.”
The ASA drew attention to the advert’s use of the phrase, “there is no point in keeping your money in the bank,” in a passage that likened Bitcoin to “digital gold”.
“Today there is no point keeping it in the bank—the interest rates are insulting,” the advert’s testimonial read.
“That is why when I received my pension, I put a third of it into gold, a third of it into silver and the remainder into Bitcoin.
“To me, Bitcoin is digital gold and it has allowed me to take the steps to secure the cash I already have.”
The ASA upheld a complaint that had been submitted to it, claiming that the ad was both misleading and socially irresponsible. The complaints argued that the ad failed to make clear the risks of investing in Bitcoin, and implied that buying Bitcoin was a secure way of investing savings or a pension.
The regulator found that phrases in the ad promoting “the savings power of Bitcoin” created an impression that Bitcoin wouldn’t reduce in value.
A risky investment
Coinfloor, for its part, claimed that the testimonial represented a customer’s view rather than that of the company itself; something the regulator dismissed. And although it included a disclaimer about crypto investments being “highly risky,” it was buried in the small print. The ASA found that both the font size and positioning of the disclaimer didn’t make the details clear, noting that, “The disclaimer was insufficient to counteract the overall message of the ad that buying Bitcoin represented a secure investment.”
The regulator also noted that the ad directly compared investing savings in Bitcoin with the use of regulated services, “discouraging consumers from placing their money in banks.” As Coinfloor isn’t regulated in the UK, consumers wouldn’t be able to seek recourse from the likes of the Financial Ombudsman Service in the event of a complaint.
“We concluded that the ad irresponsibly suggested that purchasing Bitcoin through Coinfloor was a secure way to invest one’s savings or pension,” the authority stated.
The ban comes more than a year after crypto exchange BitMEX faced similar troubles in 2019. It took out a front-page ad showing the rise in since the asset’s inception—but the ASA found that the scale of the chart could be misinterpreted by a wide audience without specialist knowledge.