Facebook Banning ICO Ads Is ‘Good for the Industry’
Blockchain media experts support Facebook’s decision to ban all ads that promote cryptocurrencies and initial coin offerings (ICOs).
"Facebook banning ICO ads is good for the industry in the long run. The ability to promote potentially scammy ICOs with ads that the general public may get duped by would ultimately hurt ICOs as a whole,” Margaux Avedisian, executive vice president of Transform Group, a U.S.-based PR firm with a focus on blockchain companies, told Cryptonews.com.
In its new advertising policy, Facebook outlines that it will prohibit ads that “promote financial products and services that are frequently associated with misleading or deceptive promotional practices.”
Katie Olver, founder of UK-based Cryptoland PR, reiterated that the ban of ICOs ads was a much-needed measure.
“It is intended to help reduce the number of scams and protect unsophisticated investors from losing a lot of money,” she said.
Amy Karr, co-founder of blockchain and cryptocurrency firm Ventus, also fully supports Facebook banning ICO ads to protect the growing cryptocurrency community. She thinks the new regulation will make it much harder for cryptocurrency and blockchain scams to thrive and will only have positive results for the industry as a whole.
“It encourages more investors to do their own research and invest in blockchain projects they truly believe in,” she said.
While this ban may impact the advertising industry, Avedisian says it will not harm the PR and journalism industries because of the checks routinely made on each featured company.
“In PR and journalism, we have checks to try and prevent advocating for scams. The PR firm does due diligence as well as the reporter writing the story,” she said.
“Use your retirement funds to buy Bitcoin!” and, “Click here to learn more about our no-risk cryptocurrency that enables instant payments to anyone in the world,” are examples of misleading headlines given by the Facebook advertising page.
"If your knowledge on cryptocurrency is low, you tend to get influenced by these articles [on Facebook] on a daily basis," Jeff Park, consumer trend research professional at Seoul based LG Science Park R&D Center, told Cryptonews.com.
According to Park, when people see a short post on Facebook with a screen capture of a successful investor who’s made six figures on a single trade, they can be easily convinced to jump into the crypto-arena.
"It is not easy for young millennials to stop and think that rash investment is wrong when you have someone in your office boasting that he or she has made serious money through Ethereum or Ripple. It’s like tobacco or alcohol. You know that they are bad and could cost you a pretty penny, but you just can’t help yourself," Park added.
Park said the Facebook ban will have less impact in South Korea than in the U.S. because Koreans rely more on word-of-mouth and primary sources. He points out other platforms that can still be used for advertising crypto projects:
“If Facebook is for fun, earned media such as online communities and mobile messenger app platforms are the real deal in Korea. DC Inside, originally a harmless online blog community dedicated to photography, has so many members that it has content for almost all topics. Same for dating apps, professional apps, game apps and many others. They all have sections for Bitcoin.”