Hype or Harm? The great social media crypto con

BEUC and nine of its members (ASUFIN and OCU, Spain; Altroconsumo, Italy; DECO, Portugal; Forbrugerrådet Tænk, Denmark; KEPKA Greece; Vartotojų aljansas, Lithuania; SOS Poprad, Slovakia; UFC-Que Choisir, France) filed a complaint on 8 June 2023 with the European Commission and national consumer authorities against Instagram, YouTube, TikTok and Twitter for facilitating the misleading promotion of crypto assets.

Following our assessment, social media companies are responsible for allowing misleading advertisements of crypto assets to multiply on their platforms (both through advertising and influencers). In our view, this constitutes an unfair commercial practice, as it exposes consumers to serious harm including, the loss of significant amounts of money.

Due to their high volatility and speculative nature, crypto assets remain highly risky investment products not suitable for many consumers. Also, it is well-documented that crypto assets may expose consumers to scams and unfair commercial practices resulting in heavy financial losses. This is why we are turning to the authorities in charge of protecting consumers to ensure Instagram, YouTube, TikTok and Twitter fulfil their duty to protect consumers.

As a solution, we are calling for the following action:

Stricter advertising policies (and enforcement of them) from the social media platforms on the advertising of crypto assets
The platforms to take measures to prevent influencers from misleading consumers as to the nature of crypto assets
The platforms to inform the European Commission about the effectiveness of the measures put in place to protect consumers against such unfair practices
European consumer authorities to cooperate with European Supervisory Authorities for financial services to ensure the platforms adapt their advertising policies to prevent the misleading promotion of crypto assets

Press release | BEUC acts against social media platforms for facilitating misleading crypto asset promotion | 08.06.2023

Report | Hype or harm? The great social media crypto con | 08.06.2023

Letter to the ESAs | BEUC action on the misleading promotion of crypto assets on social media platforms | 08.06.2023

Letter to CPC network | CPC alert on misleading promotion for crypto on social media platforms | 08.06.2023