Spain is establishing rules related to how influencers, their sponsors and others promote cryptocurrencies. Influencers and other advertisers with more than 100,000 followers in the country must notify the National Securities Market Commission (CNMV) at least 10 days before plugging crypto assets. They’ll face fines of up to €300,000 (around $342,000) for breaching the rules, which come into force on February 17th.
Influencers need to disclose if they receive payment for talking up cryptocurrencies. If that’s the case, they’ll need to provide clear and impartial warnings about the risks of crypto, including the fact that investments aren’t regulated. The rules also cover companies that promote crypto assets, as well as PR companies they hire.
“If influencers weren’t covered there would be a backdoor to avoid regulation,” CNMV chief Rodrigo Buenaventura told the Financial Times. “This is new terrain, for us and for them, and there will be moments of friction but that always happens when you bring in rules for something that wasn’t regulated before.”
It’s believed to be the first time a European Union country has brought in such directives. EU members have yet to agree on how to regulate crypto across the bloc. In the meantime, Buenaventura notes, member states are tackling some crypto-related matters, including how they’re advertised.
Some influencers who have plugged crypto assets and related products have found themselves in hot water. In July, French authorities fined a reality TV star €20,000 ($22,800) for “misleading commercial practices” over a Bitcoin trading site ad on Snapchat. Kim Kardashian and Floyd Mayweather were this month named as defendants in a class-action lawsuit that accuses them of taking part in a “pump and dump” scheme.