Ads featuring cryptos, VDAs to feature disclaimer from April 1: ASCI

Self-governing advertising organisation Advertising Standards Council of India (ASCI) has said in a set of guidelines that all advertisements on virtual digital assets (VDAs) -- crypto products and NFTs -- must feature a disclaimer.

This disclaimer should be aimed at warning investors about the potential financial loss on investing in VDAs and that any regulatory recourse is unlikely in the event of a financial loss. These guidelines shall be applicable to all adverts released or published on or after April 1.
 
“The guidelines will be applicable to all advertisements released or published on or after the first of April 2022. Advertisers and media owners must also ensure that all earlier advertisements must not appear in the public domain unless they comply with the guidelines, post the 15th of April 2022,” the ASCI noted.
 
The disclaimer as suggested by ASCI reads, "Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions." In case of character limitations, the disclaimer can also be shortened to, “Crypto products and NFTs are unregulated and risky” followed by a link to the complete disclaimer.
 
It further states that the disclaimer should be inserted in the ads in a manner that this warning is prominent and unmissable for an average consumer. The ASCI further notes in its guidelines that at least one-fifth or 20 per cent of the ad space towards the bottom of the print or static ad should be dedicated to this disclaimer.
 
It also says the disclaimer should be written in an easy-to-read font against a plain background and to the maximum font size according to the ad space. These guidelines also state that the disclaimer should be made in the dominant language of the ad.
 
In case of a video ad, “the disclaimer should be placed at the end of the advertisement against a plain background. A voice over must accompany the disclaimer in text. The voiceover should be at a normal speaking pace and must not be hurried.”
 
The ASCI guidelines added that in long format videos of more than 2 minutes, the disclaimer should be repeated both at the start and end of the video and should remain on screen for at least 5 seconds.
 
In case the video is 15-seconds-long or lesser, the disclaimer has to be carried as an overlay. In audio ads, disclaimer must be spoken at the end of the advertisement. In disappearing stories or posts without text, the disclaimer should be voiced towards the end of the story.
 
The disclaimer has to be carried in captions and picture/video attachments in case of social media posts, adding it should be carried in the beginning of the caption of the social media post. Advertisers should avoid using the words – currency, depositories, securities and custodian – for VDA ads as consumers tend to associate them with regulated products, as per the self-regulating body.
 
“The information contained in advertisement shall not contradict the information or warnings that the regulated entities provide to customers in the marketing of VDA products from time to time,” the guidelines mentioned. The ASCI further underscored that celebrities and prominent personalities who feature in these ads should take special care to ensure they have done due diligence about the claims made by the company so that consumers are not given false information.
 
It said that the ads should not attempt at downplaying the risks associated with investing in cryptos and NFTs and that returns for periods of less than 12 months shall not be promised. It further said that VDA products or trading should not be marketed as a solution to financial problems, personality problems, etc.