OCT. 3, 2018
According to CNBC, Google will now allow regulated crypto exchanges to buy ads. The updated policy takes effect this month and only allows ads to run in the United States and Japan.
Cryptocurrency ad buyers first learned about Google’s ban on ads promoting initial coin offerings (ICOs), wallets, and trading advice back in March 2018. Twitter and Facebook were also implementing bans for these types of ads. However, Facebook lifted its ban back in June, implementing new stipulations, such as submitting an application with public background information about the business. Google appears to be following a similar pattern, allowing some leeway while still keeping strict rules in place.
The Original Cryptocurrency Ban
The initial ban strictly prohibited all ads that promote products or services such as binary options, cryptocurrencies, and related content, including initial coin offerings, cryptocurrency exchanges, cryptocurrency wallets, and cryptocurrency trading advice. Additionally, it prohibited ads for aggregators and affiliates for the following:
- Contracts for Difference
- Rolling spot forex
- Financial spread betting
- Binary options and synonymous products
- Cryptocurrencies and related content
Google officially implemented these original restrictions back in June 2018. They were “intended to protect consumers and included initial coin offerings (ICOs), wallets and trading advice,” reported CNBC, “which are still not allowed.” Interested advertisers could acquire certification if they offered Contracts for Difference, rolling spot forex, or financial spread betting, but only in certain countries. To acquire certification, advertisers had to meet Google’s strict requirements.
Google’s New Cryptocurrency Policy
Under the new policy, advertisers still need to apply for certification to deliver cryptocurrency ads to US and Japan audiences. Although the policy applies to all advertisers globally, ads can only run in these two countries. Interested advertisers will need to apply for certification individually for each country. The updated policy officially took effect in October 2018.
Social media platforms appear to be uncertain of their stances on cryptocurrency ads. While digital currency has demonstrated potential for great financial flourishing, there are also a lot of unknowns. People who are not entirely familiar with how the system works are susceptible to frauds and scams, which could result in devastating repercussions. Companies like Google need to be extra careful when dealing with cryptocurrency ads because if it allows a scam company to run ads, audiences could leave for a different platform where they feel safer.
“We don’t have a crystal ball to know where the future is going to go with cryptocurrencies, but we’ve seen enough consumer harm or potential for consumer harm that it’s an area that we want to approach with extreme caution,” Scott Spencer, Google’s director of sustainable ads, told CNBC.
The new policy should not affect Google’s recent ban of crypto-mining apps on the Google Play Store. The company announced the developer policy update over the summer. Crypto-mining is the practice of using enormous amounts of processing power to quickly obtain virtual currencies or “digital coins.”
“It’s unclear why Google is lifting its ban now,” The Verge observed, “but it would appear that the company thinks the crypto hype over skyrocketing digital currency values and all of the negative side effects associated with that has died down.”
Facebook’s lift of its cryptocurrency ban may have had something to do with Google’s change of heart. Facebook initially implemented the ban after heightened interest in cryptocurrency brought with it manipulators such BitConnect, a Ponzi scam, and Prodeum, a company that disappeared with investors’ money. In response to these unethical players, Facebook banned cryptocurrency ads in January 2018.
Lifting the ban, albeit with strict stipulations, increases Facebook’s ad revenue stream. Google’s reasoning for its partial ban reversal likely falls along similar lines, as the ad revenue potential in cryptocurrency circles is high.
While Google and Facebook appear to be making adjustments to their policies on cryptocurrency, Twitter so far seems set in its ways.
“We are committed to ensuring the safety of the Twitter community,” Twitter told The Verge when it announced the ban.
It would come as no surprise if Twitter were to eventually follow Facebook and Google with a partial lift of its cryptocurrency ban. However, for now, the social network is not ready to risk any potential for fraudulent activity on its platform. Perhaps it is simply a matter of establishing a rock solid policy and foolproof stipulations.
The Future of Cryptocurrency
Since there is no clear answer to the future of cryptocurrency, the best option seems to lie in compromise. Companies like Google want to provide positive experiences not just for users but also for advertisers. Legitimate cryptocurrency companies do exist, so it doesn’t seem fair to cut them off entirely. In fact, according to Forbes, 70 percent of institutional finance executives say cryptocurrency is here for the long haul.
Greenwich Associates conducted the survey of the institutional finance executives that discovered the findings. “We’ve had a terrible market for crypto this year, but people are still coming out with a lot of great innovation and a lot of great ideas,” Richard Johnson, a vice president in Greenwich Associates’ Market Structure and Technology group, told Forbes.
Investopedia believes technological advances may be able to eliminate some of the existing limitations of cryptocurrencies. Today, a simple computer crash or a hacker can eliminate a consumer’s cryptocurrency fortune in an instant. However, since technology is continuously evolving, there may be a solution to those limitations somewhere down the road.
Honest advertisers who want to promote cryptocurrency should have the opportunity to do so, and they shouldn’t be punished for the unethical and illegal behaviors of dishonest advertisers. Legitimate advertisers should take comfort in the fact that Google and Facebook are taking the necessary measures that will allow them to advertise on their platforms.
That being said, Google and Facebook should continue to proceed with caution. Facebook has already been in the hot seat one time too many for breaches to users’ online security. Recently, Facebook was hacked, forcing 90 million users to log back into their accounts. The dust hasn’t even quite settled yet from the Cambridge Analytica scandal, when users discovered their data were used to create manipulated messages during the 2016 US Presidential Election. It only makes sense that online security is a number one priority for all major platforms.
Luckily, Google has not been an accidental player in any massive data breaches like Facebook as of yet. As long as the company continues to be alert and proactive as it has been, both advertisers and users alike will be protected.
Written by Anna Hubbel, contributing writer