The social platform Twitter has become the latest online giant to ban the advertising of cryptocurrencies and initial coin offerings (ICOs).
Rumors started to circulate in early March as the micro-blogging site announced it was taking measured to prevent crypto-related accounts from “engaging with others in a deceptive manner”.
The ban, which is due to be implemented immediately and should reach every user within the next 30 days, will also include all ads related to cryptocurrency exchanges and wallet services with the exception of publicly listed companies that are available on specific major stock markets.
Echoing Google and Facebook
The move is thought to be prompted by earlier policy changes from both Facebook and Google, who have collectively agreed to ban advertisements that promote cryptocurrencies and ICOs. Facebook added advertising related to “binary options, initial coin offerings, or cryptocurrency” under its “prohibited financial products and services” policy earlier this year. Google, the world’s largest online advertising provider, announced its own ban on crypto advertising, which will come into effect in June.
However, the ban will not apply to cryptocurrency exchanges registered and licensed to operate by the Financial Services Agency (FSA), the country’s financial regulator.
Speaking to The Verge, a spokesperson for Twitter said: “The policy will be fully enforceable among all advertisers within a month.”
In a statement, the company added: “We are committed to ensuring the safety of the Twitter community. As such, we have added a new policy for Twitter Ads relating to cryptocurrency.
“Under this new policy, the advertisement of Initial Coin Offerings (ICOs) and token sales will be prohibited globally.”
Earlier this month, the company began removing accounts that intentionally solicit cryptocurrency exchanges, impersonating famous figures like Elon Musk, John McAfee, and Ethereum co-founder Vitalik Buterin.
Twitter, the go-to source for breaking news for a lot of people, has been dubbed “Crypto-Twitter” as CEO Jack Dorsey has previously come out in favor of bitcoin, but the new policies are designed to discourage opportunities for fraud and deception, which can be rife for those navigating the trading community for the first time.
After the announcement on Monday, March 26, Bitcoin fell roughly 7% to below $8,000 (£5,649) following weeks of regulatory uncertainty and advertising crackdowns by tech companies.
The digital currency dropped 12% in late January after Facebook announced its upcoming ban also applied to partner platforms Instagram and Audience Network, it’s advertising platform. However, similar to Jack Dorsey, Mark Zuckerberg has also spoken out in favor of cryptocurrencies. In an interview with CNN last week, Zuckerberg even suggested that Facebook itself could benefit from regulation – an issue that is heavily tangled within cryptocurrencies and ICOs. He said: “I’m actually not sure we shouldn’t be regulated. In general, technology is an increasingly important trend in the world, and I actually think the question should be ‘what is the right regulation?’ rather than ‘yes or no, should it be regulated?’
“On the basic side, there are things like ads transparency regulation that I would love to see. If you look at how much regulation there is around advertising on TV and in print, it’s just not clear why there should be less on the internet, you should have the same level of transparency required.”
Perhaps the biggest reason for the censorship is that financial watchdogs have been vocal about potential risks in initial coin offerings, or digital coins released through fundraisers known as token sales.
This led to the U.S. Securities and Exchange Commission upping efforts to police the fundraising process through scores of subpoenas reported earlier in March.
However, a report from SimilarWeb, a web traffic tracker, showed that less than 1% of traffic on exchange sites actually comes from paid ads. Most cryptocurrency exchange sites instead derive their traffic from coinmarketcap.com, which tracks market capitalization numbers, and not from paid ads. So it remains to be seen just what influence these bans may have.