According to a recently published European Consumer Organization (BEUC) report, popular social media platforms like Instagram, TikTok, Twitter, and YouTube have been enabling scams related to digital assets. In their 20-page analysis, the watchdog marked digital assets as highly risky and prone to scams, emphasizing the impact cryptocurrencies have on consumers and the role of crypto influencers.
The BEUC criticized the lenient approach of these social media platforms towards crypto advertising as it paves the way for scammers to target unsuspecting teenagers. Despite the existence of internal advertising policies, the research unearthed evidence of misleading crypto promotion on these platforms.
The BEUC, a group representing 45 independent consumer organizations from 31 countries, has taken this issue to the European network of national consumer authorities or CPC-Network. They have called for stricter enforcement of advertising policies on social media platforms.
In addition to strengthening advertising regulations, the BEUC has also urged the CPC-Network to mandate social media platforms to prohibit crypto product promotion by influencers. This measure would introduce appropriate mechanisms to protect consumers from unfair commercial practices within the digital asset space.
The recent BEUC report coincides with the European Union’s focus on crypto legislation. The Markets in Crypto Asset (MiCA) legislation was approved with an aim to counter the “wild west” mentality in the digital assets sector. Set for implementation in 2024, the regulation seeks to provide legal clarity and protect investors from fraudsters while fostering innovation in the ecosystem.
As the EU spearheads laws for the crypto market, it requires firms issuing, trading, and safeguarding crypto assets, tokenized assets, and stablecoins across the 27-country bloc to obtain a license.
Some social media platforms have already started combating crypto scams. Last month, YouTube acted to block an XRP cryptocurrency scam promoted on the hacked YouTube channel DidYouKnowGaming. Aware of the hacking, DidYouKnowGaming’s team voiced their concerns on Twitter, urging YouTube to help regain access to their lost account.
Unfortunately, the number of creators falling victim to scams propagating on social media is only increasing, and larger channels like Linus Tech Tips have reported similar incidents. The recent spike in deepfakes – AI-generated fake videos impersonating well-known figures to deceive investors – compounds the risks associated with such scams. Given these circumstances, it is essential to exercise caution and ensure the safety and security of users navigating the world of digital assets.
Source: Cryptonews
