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Spain will control influencers promoting cryptocurrency

Spain will control influencers promoting cryptocurrency

Spain has announced new rules on how social media influencers and others can advertise cryptocurrency assets, Reuters reports. Starting next month, the Spanish National Securities Market Commission (CNMV) will require people and companies to notify it at least 10 days before campaigning for crypto assets. The rules apply to influencers with more than 100,000 customers who are paid to promote the cryptocurrency – a practice that has been criticized and even led to lawsuits around the world.

According to Reuters, crypto advertisers will be required to release the content of their upcoming campaigns to CNMV, and they will need to include warnings about the risks they sell. The rules are designed to allow the CNMV to oversee the marketing ecosystem surrounding crypto assets and to ensure the audience is aware of the risks.

CNMV has previously used social media to throw cold water on crypto hype. In November it responded to a tweet by professional football player Andres Iniesta, when he enthusiastically promoted cryptocurrency exchange Binance, warning him that "cryptos, being unregulated products, carry some significant risks." (It was unclear whether Iniesta was paid for his promotion.)

Cryptocurrency and social media advertising are both areas with significant regulatory ambiguity, and the combination has proved to be troublesome at times. Earlier this month, a proposed class action suit targeted Kim Kardashian, boxer Floyd Mayweather and others for promoting the Ethereummax currency — dramatically raising its value before the asset became nearly worthless. CNMV's new rules won't stop influencers from telling their followers about cryptocurrencies, but they will allow the agency to take a closer look at what's actually being offered.

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