Influencers launch crypto to recruit investors, but without warning
Indian crypto exchanges are bombarding people on social media platforms with advertisements, in an effort to entice young users to invest in the digital asset class. As the market places its hope in the holiday season for increased sales, cryptocurrency exchanges have doubled their marketing spend as cryptocurrencies have yet to be accepted as legal tender and are in short supply. legal framework and regulatory standards in the country.
Crypto platforms are now doing everything possible to promote cryptocurrencies in the country. From securing Bollywood celebrities such as Amitabh Bachchan and Ayushman Khurana as their brand ambassadors to extending their influencer marketing across vast boundaries, everything is done to ensure people are “curious” about crypto investments. .
To put it in perspective, a Morning Consult survey cited by Bloomberg found that 45% of crypto investors said they would invest in crypto on the basis of celebrity approval, and 20% of all investors indicated. that they might be persuaded to invest. in crypto by an A-list celebrity.
Campaigns by local cryptocurrency exchanges often have social media influencers talking about financial literacy and encouraging young people to invest in the digital asset class. But such promotions could prove to be very risky for newbie investors who rush to crypto exchanges, with the aim of making a profit. Cryptocurrency exchanges have also started using influencer marketing materials to reach next-gen digital natives.
Speaking to indianexpress.com, Pranav Panpalia, founder of OpraahFx, an influencer marketing firm, said that promoting cryptocurrency trading without explicitly stating the risks and volatility of digital assets would give the public the feeling betrayed when he learns more.
âSeveral high-profile influencers are casually promoting cryptocurrency to attract young people without any warning, and this is a matter of concern,â he added.
Echoing similar sentiments, video and content creator Vedant Kaushik said influencers promoting crypto assets should have disclaimers for transparency and awareness. âCrypto scams are now also prevalent. Responsible advertising is important … especially in the case of influencers because they are aimed at a younger audience. It is important that influencers choose to be transparent rather than responding to their selfish motives, âhe added.
Meanwhile, YouTuber Karan Singh notes that while promoting a crypto brand for investments, people risk putting their hard-earned money into an extremely volatile digital asset, especially if they don’t do their own due diligence. reasonable. âAll crypto promotion messages must be accompanied by a disclaimer stating: ‘Crypto investments are subject to market risk, please read the offering document carefully before investing,â he said. He underlines.
Paritosh Anand, an influencer and filmmaker, said Diwali plays a huge role in promoting cryptocurrencies. “People who would typically buy an asset like a car, refrigerator, or gold are now willing to invest that money somewhere that they could potentially get returns, that’s where the content that’s distributed plays a huge role. “, he underlined. outside.
It should be noted that promoting cryptocurrencies without any regulatory control can cause problems for celebrities, as not all exchanges are safe and reliable. In 2018, the founder of Pune-based crypto firm GainBitcon was arrested for allegedly duping more than 8,000 people for Rs 2,000 crore.
Earlier in July, lawyers Ayush Shukla and Vikash Kumar filed a plea in Delhi High Court arguing that the risk warning text on such ads should cover 80% of the screen to warn viewers appropriately.
So far, there are no regulations regarding cryptocurrency advertising in India. Meanwhile, the Blockchain industry body and the Crypto Assets Council have yet to release self-regulatory guidelines on advertising for these companies in the future.