France has created a new Task Force to tackle the recent boom of influencers who promote cryptocurrencies, and ensure there is consumer protection in place so as to protect against the slew of crypto scams and Ponzi schemes that lead to consumers losing money.
With the popularity of cryptocurrency rising, social media platforms have been favoured as marketing tools by crypto projects who wish to take advantage of the high number of followers that many celebrities and influencers have on Instagram, Youtube, or Facebook, to name a few of the key platforms used to promote cryptocurrencies.
The issue with using influencers to promote crypto projects is that it potentially exposes vulnerable individuals to uninformed financial advice. An influencer’s followers may not understand that the promoter is in fact being paid to promote said crypto, as a promotion is not always labeled as such, and the ‘opinion’ of an influencer may be interpreted as a sure thing by those who look up to them.
The AMF stated:
“Social networks and influencers are the new gateways that have emerged in recent years. In this way, the target is a younger audience, who have very little knowledge of financial markets.”
In response to this, and other issues surrounding this subject the French body responsible for consumer protection and fraud prevention has come up with a task force to specifically target crypto promotion, the collaboration between the French Public Prosecutor’s Office, Bercy, and the AMF. A representative for the DGCCRF said:
“Influencers often promote highly volatile cryptocurrencies and financial products, and it becomes very difficult for newcomers to anticipate fluctuations.
The new task force will be responsible for reprimanding influencers who promote ‘deceptive content’ likely to be in the form of a fine.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.