Indian crypto exchanges are bombarding people across social media platforms with advertisements, in a bid to woo young users to invest in the digital asset class. As the market pins its hope on the festive season for a hike in sales, the crypto exchange platforms have doubled down on their marketing spend when the cryptocurrencies are yet to be accepted as legal tender and lack a legal framework and regulatory norms in the country.
Crypto platforms are now doing everything possible to promote cryptocurrencies in the country. From getting A-list Bollywood celebrities such as Amitabh Bachchan and Ayushman Khurana as their brand ambassadors to spread their influencer marketing to vast boundaries—everything is being done to ensure that people are made ‘curious’ about crypto investments.
To put into perspective, a survey by Morning Consult cited by Bloomberg revealed that 45 per cent of crypto investors said that they would invest in crypto-based on a celebrity endorsement, and 20 per cent of all investors indicated that they could be persuaded to invest in crypto by an A-list celebrity.
Campaigns run by local cryptocurrency exchanges often have social media influencers talking about financial literacy and encouraging youngsters to invest in the digital asset class. But such promotions could prove very risky for newbie investors who are gushing towards crypto exchanges, aiming to book profits. Cryptocurrency exchanges have also started using Influencer marketing mediums to reach the next-gen digital natives.
Speaking to indianexpress.com, Pranav Panpalia, founder, OpraahFx, an influencer marketing company said that promoting cryptocurrency trading without stating the risks and volatility of the digital assets explicitly, will make audiences feel betrayed when they learn about it.
“Several renowned influencers are promoting cryptocurrency casually to attract youngsters without any disclaimer, and that is a matter of concern,” he added.
Echoing similar sentiments, video and content creator Vedant Kaushik said that influencers promoting crypto assets need to have disclaimers for transparency and awareness. “Crypto scams are now prevalent too. Responsible advertising is important…more so, in the case of influencers as they are catering to younger audiences. It is important that influencers opt to be transparent than fulfill their selfish motives,” he added.
Meanwhile, YouTuber Karan Singh notes that while promoting a crypto brand for investments, people are at risk of putting their hard-earned money into an extremely volatile digital asset, especially if they fail to do their own due diligence. “All crypto promoting posts should come with a disclaimer stating: “Crypto investments are subject to market risks, please read the offer document carefully before investing,” he pointed out.
Paritosh Anand, an influencer and filmmaker said that Diwali is playing a huge role in the promotion of cryptocurrencies. “People who would generally buy an asset like a car, a fridge or gold are now willing to invest that money somewhere where they could possibly get returns from, which is where the content that is being distributed is playing a huge role,” he pointed out.
It is worth noting that promoting cryptocurrencies without any regulatory scrutiny can land celebrities in trouble because not all exchanges are safe and reliable. In 2018, the founder of Pune-based crypto company GainBitcon was arrested for allegedly duping more than 8,000 people of Rs 2,000 crore.
Earlier in July, advocates Ayush Shukla and Vikash Kumar filed a plea in Delhi High Court arguing that risk disclaimer text on such ads should cover 80 per cent of the screen to warn viewers appropriately.
So far, there are no regulations around cryptocurrency advertising in India. Meanwhile, the industry body Blockchain and Crypto Assets Council is yet to release self-regulatory guidelines on advertising for such companies in the future.