By picking up ads, crypto remains intact

advertising is a powerful tool. The power of the British advertising supervisory authority is less clear.

The Advertising Standards Authority is again against crypto. The problem is that there is no one else in Great Britain.

The ASA officially complained on Wednesday because they violated the standards of the advertising industry. At the beginning of July, companies had warned of underestimating the risks of investments in a volatile asset class, misleading investors and downplaying crypto.

Papa John's advertising campaign, which calls customers to "transform pizza into Bitcoin worth 10 pounds", is a few months ahead of this warning. However, all other judgments published by the ASA relate to advertisements that have been published since mid -July.

Maybe the standards expected by crypto advertisers were unclear how the CEO of the Luno app complained. The judgments of the ASA should help to clarify what it thinks is acceptable.

But these are not the display of an industry is anxiety for the supervisory authorities. It is still a "wild west", whatever companies say, to fulfill the desire. The advertising industry of self -regulatory agency - no specialist in complex financial services - is unlikely to hit the hearts of the companies. The strength is missing directly, even if it can refer repeaters to the competition and market supervisory authority.

There are many difficult questions on how digital assets should be regulated and who should do this. It's not so easy to say-to take over a luno advertising from the beginning of this year-"If you see Bitcoin in the subway, it is time to regulate."

But when you see Bitcoin advertising in the subway, it is probably at least time for the time that the financial supervision regulates it.

To be fair, the Financial Conduct Authority has been pushing for the responsibility for crypto advertising campaigns for some time. This is usually not in the area of responsibility of the EZV. State measures are required to expand the so -called Perimeter of the FCA. A consultation of the Ministry of Finance on this topic was completed more than a year ago. In a fast -moving industry, it is difficult to say that the British government keeps pace.

However, it should be clear that the regulation of crypto advertising will not be sufficient. And an apprenticeship from the ASA's efforts is that it is important to select the right regulatory authority that assumes responsibility.

There are those who argue that crypto calls it an investment, recognize it with a status that it does not deserve. Peter Hahn, emeritus professor of economy and finance and former advisor to the Prudential Regulation Authority, argued in a letter to Financial Times that it was better to regulate crypto such as gambling.

The problem of FCA regulation, which makes crypto credible and creates confusion about what is covered and what is not, is one that is very aware of the FCA. The outgoing chairman of Watchdog, Charles Randell, dedicated a speech to the risks of a "token" regulation in September. The memory of the minibond scandal around London Capital & Finance, in which investors assumed that FCA regulation was not only valid for the company, but also for the product they bought, is raw fca boss.

but also treating crypto as a gambling is not a satisfactory solution. An independent report on the regulation of the collapsed betting company Football Index showed the dangers of blurred jurisdiction boundaries between the financial and gaming guards. The report found that the gambling commission was not known to important parts of the business model of the "football exchange" and that the FCA was slowly, inconsistent and poorly in communication with its other regulatory authorities.

binary options - quick bets on financial market movements - were also compared five years ago with games of chance. They were only banned when they were laid from the area of responsibility of the gambling commission.

The FCA's own evidence is that the proportion of investors who equate crypto with games of chance drops. Whether the financial guard likes it or not, crypto has a mainstream credibility that cannot be vowed away. The FCA will have to take on a larger role. Coordinated international measures are clearly necessary and crypto control is undoubtedly complex. But it harbors dangers to rely on non -specialized supervisory authorities to eliminate the chaos in the meantime.

cat.rutterpooley@ft.com