- The circular covers advertising of crypto-assets presented as investments, in any medium.
- Mass campaigns must be notified to the CNMV in advance, without waiting for launch.
- Each ad will carry a visible risk warning, and advertisers will keep a record of their campaigns.
The BOE of Monday 17 January 2022 published Circular 1/2022 of 10 January of the National Securities Market Commission (CNMV), on the advertising of crypto-assets presented as investments. It is issued under article 240 bis of the Securities Market Act and will take effect a month later, on 17 February.
The rule requires campaigns aimed at more than 100,000 people, through any medium, to be notified to the CNMV ten working days in advance, and every ad must warn that investing in crypto-assets is unregulated, may not be suitable for retail investors and may lead to the loss of the entire amount invested. It is a specific and new framework in Spain on how these assets may be advertised. It is a regulation that does not prohibit advertising these assets, but conditions how and with what information it is done.
Which assets and who is affected
The circular refers to crypto-assets that are not financial instruments and that are promoted as an investment opportunity. How they are advertised matters more than their technical label: if the advertising presents them as an investment, the rule applies. The authority comes from Royal Decree-Law 5/2021, which gave the CNMV powers to supervise the advertising of these products. In practice, the key will be how each advertiser interprets when a crypto-asset is presented as an investment, a criterion that may raise doubts in campaigns with an ambiguous tone.
It reaches three groups: crypto-asset service providers that advertise, advertising service providers, and any individual or company that advertises on its own initiative or on behalf of third parties. In other words, not only platforms and issuers but also agencies, media and endorsers who run campaigns in return for payment.
Specific obligations
The prior notification applies to mass campaigns, and the CNMV may also require it from certain parties in view of the impact they could have on the public. The warning must have a format and position that ensure its prominence and include a link or reference to further information. It is not meant to be fine print, but a message the recipient can actually read.
Those covered must keep a campaign record with the information and documentation of campaigns under way and of those run in the previous two years. The CNMV may request specific information about them and require their correction or withdrawal, so traceability of what was advertised, when and with what reach becomes part of compliance. Any breach may lead to requests from the CNMV, so it is worth documenting the decisions taken in each campaign.
What to review
Companies that advertise this type of asset, and the communication professionals working for them, should review their contracts, campaign calendars and the text of each piece well before 17 February. It is also worth defining who estimates the expected reach of each campaign and who keeps the documentation.
For the public, the circular is a useful reminder: an advert is not a recommendation or a guarantee, and the mandatory warning summarises real risks. This note is for information only and is not investment advice. Europe is also drafting its own regulation on crypto-asset markets, which could change the framework in the coming years. Finally, those who work with influencers or media should pass these obligations on by contract, to prevent a message published without the warning from creating liability.
The circular does not regulate the asset, but it does regulate how it is advertised, and it requires the risk to be visible.
This article is general information. It is not legal, tax or investment advice, and it does not take anyone’s particular circumstances into account.
