Facebook Lifts Ban on Cryptocurrency Ads That Meet New Standards
Some bullish news has arrived in a struggling market, as Facebook has announced they are lifting their ban on cryptocurrency advertisements — but it’s with a catch.
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Ads Must Have Facebook’s Written Permission
The third most visited website in the world will once again allow cryptocurrency advertisements that successfully obtain “written permission” from the social media juggernaut, meaning the array of what is shown to users will not be quite the same as it once was.
Prospective advertisers will now need to submit an application to Facebook and make their case to Mark Zuckerberg’s team. In addition to their pitch, they will be asked to submit “any licenses they have obtained, whether they are traded on a public stock exchange, and other relevant public background on their business.”
With an emphasis on user protection against deceiving and misleading content, advertisements for Initial Coin Offerings (ICOs) will remain a thing of the past as those are still on the ban list.
News outlets in the industry will likewise have to fill out the same application to qualify for advertising.
Fears of Scams Supposedly Led to Ban
Back in January Facebook instituted a full scale blockade on such advertisements, making it clear that their goal was to provide users an experience on the site “without fear of scams or deception.” At the time Bitcoin had fallen from its high of nearly $20,000 USD in late December to around $12,000. It currently rests at just above $6,000 with some of the crypto mania having slowed its pace, at least for now.
In April, Zuckerberg faced 10 hours of questioning from U.S. Congress, in addition to facing threats of regulatory action being instituted. One major incident in particular prompted this when the personal details for millions of users landed in the hands of Cambridge Analytica, a data analysis and consulting firm involved in the 2016 U.S. presidential election. The firm was accused of harvesting information from some 87 million users, including names, “likes”, and other unspecified personal information. Zuckerberg apologized for this incident, and restrictions have since been implemented on the site to prevent this type of data scraping.
It also resulted in a significant decline in Facebook’s stock price, with their market capitalization dropping by approximately $50 billion. Facebook’s current total market value is $576 billion, compared to the entire cryptocurrency market which currently rests at just under $245 billion. With federal scrutiny of cryptocurrency in full force, as well as the prospect of government action in the form of oversight and regulations, it’s unlikely Facebook will be taking any chances with potentially misleading advertising that could land them in hot water.
Facebook has over 2 billion user accounts registered on their site.
Is Facebook Planning Its Own Crypto?
Facebook also appears to be serious about starting their own cryptocurrency, having already formed a blockchain group to explore this possibility. Former Paypal president David Marcus is heading up this team.
In addition to facilitating payments, Facebook reportedly also hopes to use blockchain to aid in user identity verification, as well as setting up advertisement deals. News first surfaced of Zuckerberg’s interest in creating Facebook’s own coin back in January, shortly before their initial ban on crypto advertisements was put in place.
Is this good news for cryptocurrency, or is the community better off without social media advertising? Let’s hear your thoughts in the comments.
Images via Pixabay