Facebook Shuns Cryptocurrency Advertisements

In an update to its ad policy, Facebook Product Management Director, Rob Leathern, issued the company’s approach towards advertisements related to ICOs and cryptocurrencies.

In his statement, Leathern explained that Facebook will never allow “misleading or deceptive ads” on its platform and has thus made amendments to its ad policy.

The policy text is provided below:

“Ads must not promote financial products and services that are frequently associated with misleading or deceptive promotional practices, such as binary options, initial coin offerings, or cryptocurrency.”

Due to its wording, the policy can be applied to various scenarios, and Leathern states that it was the very intention behind the policy’s implementation while the company works on developing further solutions.

Leathern wrote:

“This policy is intentionally broad while we work to better detect deceptive and misleading advertising practices, and enforcement will begin to ramp up across our platforms including Facebook, Audience Network and Instagram. We will revisit this policy and how we enforce it as our signals improve.” 

However, he was quick to mention that due to the extensive nature of the ad program, the company might not be able to catch every ad that violates this policy. He advised the users to report such content if they stumble upon it so that it can be dealt with efficiently.

He concluded by stating that the policy intends “to make it harder for scammers to profit from a presence on Facebook.”

Reasons behind this decision

It would not be incorrect to state that 2017 could easily be called the year of initial coin offerings (ICOs).

During this single year alone, 891 ICOs were held, which collectively raised more than $6.6 billion. This essentially termed ICOs as the most popular crowdfunding trend of recent years, leaving the other modes far behind.

One of the reasons behind the success of ICOs is how they allow startups to gather funds quickly by offering investors stakes in the company through tokens, which can then either be monetized by those investors or used within the company for governance and other purposes.

This method of raising funds is not just quick but requires minimum capital by these startups, which can then go on and utilize the raised funds for the operations that they described at the time of the offering.

However, this very function of ICOs has also enabled malicious parties to use them as a digital alternative for traditional scam programs. Users who invest their funds in such ICOs are at risk of losing them, which had been the case in a few ICOs in 2017.

Due to these reasons, regulatory authorities such as the U.S. Securities and Exchange Commission have been issuing repeated warnings to investors, who seem susceptible to fall for promises of unprecedented gains by seeing lucrative online advertisements, most notably from social media.

Considering these facts and developments, it was not shocking to see Facebook declaring its stance on the issue. However, what seemed surprising was the social media giant’s decision to ban ICO and cryptocurrency related advertisements altogether instead of having them regulated.

The post Facebook Shuns Cryptocurrency Advertisements appeared first on Getting Started With Cryptocurrencies & Bitcoin - bitGuru.