BEUC, an Umbrella Organization of European Consumer Groups, has lodged a complaint with European Union Consumer Protection Regulators, urging Instagram, YouTube, TikTok, and Twitter to tighten their policies regarding cryptocurrency advertising.
The organization claims that the growing number of crypto asset advertisements on social media platforms constitutes unfair business behaviour, posing a risk of substantial financial losses for consumers.
These promotions are reportedly facilitated through advertising and the influence of social media personalities.
BEUC has called upon the Consumer Protection Cooperation Network to compel internet platforms to adopt stricter regulations for crypto advertising and take measures to prevent influencers from misleading consumers.
The complaint suggests that national authorities should enforce stronger regulations on social media platforms, including prohibiting influencers from promoting cryptocurrencies.
In a statement, Director General Monique Goyens emphasized the need for greater consumer protection, as crypto scams can result in significant financial harm.
In a statement, Director General Monique Goyens emphasized the need for greater consumer protection, as crypto scams can result in significant financial harm.
While current consumer rules prohibit unfair business practices, BEUC asserts that additional precautions are necessary to address the risks associated with crypto scams.
While national consumer agencies have the ability to impose fines for violations of consumer law, Goyens expressed the desire for more stringent penalties.
Notably, TikTok had committed to adhering to EU Regulations following BEUC's previous concerns regarding undisclosed marketing and aggressive advertisements targeting young users.
Despite efforts by National Authorities to combat deceptive advertising, the problem remains unresolved.
The report highlights existing legislative provisions, such as the Unfair Commercial Practices Directive, and the presence of the Consumer Protection Coordination Network (CPCN) to oversee enforcement at the EU level.
The report calls for the CPCN to request social media platforms to enforce stricter conditions in their advertising policies, including a ban on influencers promoting crypto products in their terms of service.
Additionally, it suggests that the CPCN should provide reports to the European Commission on the effectiveness of the implemented measures.
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