29 January 2024

New advertising rules for crypto provider and influencers

Category: Crypto licence

MiCAR is bringing new rules to the crypto world. As of now there is only integrity supervision from De Nederlandsche Bank (DNB). Following on from our previous blog on the upcoming introduction of MiCAR, the EU regulation of crypto tokens and their providers, we will focus in this blog on the new rules regarding crypto advertisements. Stricter rules are being introduced for both crypto companies and influencers to prohibit misleading advertising and disinformation. Read on to find out how MiCAR will transform the world of crypto. MiCAR supervision in the Netherlands is divided between AFM and DNB.

MiCAR rules have major impact for crypto providers

The Markets in Crypto-Assets Regulation (MiCAR) is a new regulation from the European Commission aimed at regulating the crypto world. In recent years, the crypto market has experienced significant growth, but this has not been without risks. The volatility of crypto attracts investors looking to make significant profits quickly, but this also comes with significant dangers. Crypto companies have so far advertised freely, at times including inaccurate information, which has been disadvantageous to uninformed investors.

The European Commission has come to an agreement on crypto regulations in June 2023, resulting in MiCAR. These regulations include specific rules regarding advertising, among other things, with the aim of better protecting consumers. By 30 December 2024 at the latest, crypto service providers must hold a licence.

New Rules on Advertising for Crypto Services

The EU regulation devotes a significant section to regulation around advertising. Due to the dangers of misleading advertisements towards consumers, strict rules have now been adopted.

  1. Clarity and Correctness
    (a) Advertising must be clearly recognisable as such.
    (b) Information in advertisements must be correct, clear and not misleading.
    (c) Information provided must be consistent with what is set out in the crypto asset white book.
    (d) Mention of the crypto asset white book with the publisher’s address, a telephone number and an e-mail address for contact.
  2. Reimbursement rights
    Advertisements should explicitly state that holders of asset-related tokens are entitled to reimbursement by the issuer at any time.
  3. Publication on the Website
    Advertisements and any amendments shall be published on the official website of the issuer.
  4. No Prior Approval Necessary
    Prior approval of advertisements by competent authorities is not required.
  5. Notification to Competent Authorities
    Upon request, advertisements must be provided to competent authorities.
  6. Restriction for Publication of Crypto Asset White Book
    No advertisements may be distributed before the crypto asset white book is published. However, this restriction does not prevent market research by the publisher.

Influencers in crypto promotion must comply with the MiCAR directive

These new regulations underline the European Commission’s commitment to making the crypto market safer for all parties involved. The focus is on honest, transparent and non-misleading communications, with the ultimate goal of increasing investor confidence and ensuring the integrity of the market. Crypto companies and influencers will have to comply with these stricter rules to remain part of a regulated and safe crypto market.

The MiCAR licence or MiCAR notification?

The MiCAR directive has two types of regulations: a licence or a notification. A licence is required for cryptoasset services. A notification requirement has been introduced for some existing financial companies. These are services similar to already existing services.

Do you have questions about what the new MiCAR rules mean for you? And would you like to know whether the licensing obligation or the notification obligation applies in your case?  If so, please contact Blenheim. Blenheim’s licensing team will be happy to assist you.