With the government raising concerns over Crypto industry's over-promising and non-transparent advertising, it was expected that the industry would pause its ongoing campaigns and come up with a new strategy once the regulatory framework becomes clearer.
However, the industry seems to be in no mood to break the investor acquisition momentum. Though it will make its communication much more transparent and start highlighting the investor risk and volatility that comes with Crypto.
The media industry was also apprehensive that with Crypto players going slow on advertising, their revenue estimate would be dented.
According to a report in the Economic Times, India's cryptocurrency exchanges spent over Rs 50 crore on advertisements during the recently concluded ICC T20 Cricket World Cup.
Apart from pure advertising, that features celebrities like Ranveer Singh, Ayushmann Khurana, Crypto exchange players have also been investing heavily in influencer marketing. The players have also been targeting major sports events across the country. WazirX, a crypto exchange player sponsored the UEFA Euro 2020, as well as the India-Sri Lanka cricket series.
Nischcal Shetty, CEO, and Founder of WazirX said that bringing the industry under regulation is a step in the right direction.
Day 1110— Nischal (WazirX) ⚡️ (@NischalShetty) November 15, 2021
India is finally on the right path towards crypto regulations
Industry consultation is crucial & it’s great to see that the crypto industry has been invited for discussions
With the right regulations, India can be a top player in crypto
Jai Hind ????????#IndiaWantsCrypto
Business Strategist Lloyd Mathias said it is a good sign that the Government has taken note of this. He said the fact that Prime Minister Narendra Modi chaired a meeting means regulations will soon be in place and added that apart from looking at the entire space of cryptocurrencies these regulators must also look after their advertising.
“Right now, the space is unregulated. They can also be avenues for misuse. And therefore, it is good that there is going to be some kind of proper regulation. At the same time, I also hope that ASCI keeps a close eye on what is happening. Hope the advertising industry looks at this closely and adheres to some self-regulation. Right now, it is very important to look at the entire space and the issues that are evolving. Therefore, the regulatory body, RBI, Finance Ministry will need to come together and put some rules around the evolution of Crypto,” Mathias said.
“The regulation on Cryptocurrency per se needs to come from regulatory bodies like RBI or the Finance Ministry. Once that is in place, I hope the advertising industry takes cognizance of that,” he added.
Currently, cryptocurrencies are not under any regulation in the country. More and more Indians have been investing in Crypto assets and testing waters, however, the environment is volatile, and hence regulating is imperative, experts feel. The crypto players have been committing to self-regulation under the BACC (Blockchain and Crypto Assets Council) code of conduct under the IAMAI (Internet and Mobile Association of India).
According to a marketing head at a Crypto exchange, it is too early to comment on the developments as they are still being worked on. The brand’s strategists are still working on the right plan.
“For Crypto or any other financial products, awareness is the key. We are partnering with various TV and Print partners, we are holding podcasts, those are also a part of our efforts to build awareness in English as well as vernacular markets," he said.
“The conversations have just begun, and the team also needs some time to understand them to work out new strategies. Eventually, whatever Government bodies and ASCI tell us, we have to follow,” he added.
Harish Bijoor, Founder, Harish Bijoor Consults, said the advertising campaigns from the sector will go on as usual. “Crypto players are very large advertisers today. There is a clamour to grab eyeballs initially. The Central Government pronouncements will bring on more responsible advertising. The key idea is to ensure that common investors do not get rooked by an industry that is just about defining its rules of engagement.”
Citing similar sentiments, Samit Sinha, Managing Partner, Alchemist Brand Consulting, said he sees the current developments more as a warning for the players. “It is difficult to predict how they (crypto brands) will react. Certainly, they (authorities) are going to be watchful. I think there is going to be some confusion in everyone’s minds. I think even the Government is in a dilemma because even they know it is not something that can be stopped. Cryptocurrency and Blockchain technology are the future and they are here to stay.”
Rajesh Ramaswamy, Founder of The Script Room, said, “It is a sector that is filled with corporates and well-established individuals from corporate companies. I’m sure they will find a meeting ground about how to go forward.”
“Even the disclaimers that are being put out there are of their own accord, it is not being dictated by anyone like how it has been with mutual funds. I just feel all this will end up with ads having longer disclaimers,” he added.
Sathvik Vishwanath Co-Founder and CEO, Unocoin, stated, “Given that the regulatory framework is not in place, it appears to the industry that any advertisement with a disclaimer is an acceptable ad. As the framework could take more than a few months it is high time for the government to do ads highlighting the risks associated with crypto.”
Speaking about the development, Manisha Kapoor, Secretary-General of ASCI, said, "We are in consultation with the government on this issue currently and will work together with them to protect consumer interests in so far as advertising of these products goes."