Virtual Currency Gets Real Social Media Ads

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Reversing course, Facebook has relaxed the advertising standards for the promotion of blockchain, cryptocurrency and other financial products on the social media site.

Last year, the social networking site banned ads for crypto-related and other speculative financial services products, expressing concern about “financial products and services frequently associated with misleading or deceptive promotional practices.”

Google and Twitter followed suit with similar prohibitions. The sites all recognized that the ban wasn’t permanent, and Facebook later amended its policy to allow such ads with prior approval.

On May 8, 2019, Facebook announced that it will immediately remove the prior approval requirements for ads related to blockchain technology, industry news, education or events related to cryptocurrency. In its announcement, Facebook said the change came as a result of “feedback and assess[ment] of the policy’s effectiveness.”

Prior approval is still required for ads promoting cryptocurrency and closely related products (such as cryptocurrency exchanges and mining software and hardware). “This process will continue to take into account licenses they have obtained, whether they are traded on a public stock exchange (or are a subsidiary of a public company) and other relevant public background on their business,” according to the announcement.

Facebook reminded advertisers that an ad’s text, targeting, positioning, images and content must still comply with the general advertising policies and community standards.

Additionally, effective June 5, 2019, Facebook is adding ads for contracts for difference (these “complex financial products” that are “often associated with predatory behavior,” Facebook explained) to the list of prohibited financial products and services, which still contains initial coin offerings and binary options.

“We’re committed to preventing misleading advertising on our platforms, especially in the area of financial products and services,” according to the announcement.

To read the new policy, click here.

Why it matters: The policy changes are good news for those seeking to advertise blockchain technology, industry news, education or events related to cryptocurrency, and provides a road map for advertisers of cryptocurrency and closely related products, with guidance on certain factors that are considered during the approval process, such as account licenses and whether they are traded on a public stock exchange.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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