Twitter Bans Crypto-Currency Advertising to Combat Fraud
Twitter made a significant move yesterday by announcing a ban on all crypto-currency advertising in an effort to tackle the increasing levels of fraud within the industry. The micro-blogging platform issued a statement outlining the new policy:
“We have implemented a new policy for Twitter Ads specifically targeting cryptocurrency. This policy prohibits the advertisement of Initial Coin Offerings (ICOs) and token sales on a global scale.”
Reports indicate that the ban will extend to advertisements from crypto-currency exchanges and wallet services, unless they are from publicly traded companies.
This decision by Twitter follows in the footsteps of Facebook and Google, both of which have implemented similar restrictions. The move comes in response to the growing concerns surrounding fraud and cyber risks as investors flock to capitalize on the digital gold rush of crypto-currencies.
Industry Response
One industry expert, Alexey Burdyko, CEO of blockchain company Play2Live, lauded the announcement. He believes that the long-term impact of the ban will ultimately benefit the crypto-currency industry by safeguarding its user base.
“One of the key objectives of banning these ads is to protect investors from fraudulent schemes and scams that seek to exploit them. These malicious actors are eroding trust in new token sales. If this goal is achieved, trust can be gradually restored, and future crypto-launches will thrive,” Burdyko told Infosecurity.
“The prevalence of scams in this space is indisputable – they exist, and they are adept at deceiving individuals into parting with their funds.”
Security Concerns
An Ernst & Young report published in January revealed that hackers and fraudsters have managed to steal 10% of all ICO funds, resulting in nearly $400 million in losses to date.
Phishing attacks are a common tactic, with perpetrators making up to $1.5 million per month by either tricking victims into transferring funds or surrendering their digital wallet’s private keys.
Burdyko emphasized that investors and aspiring start-ups will find ways to navigate around the ban on social media ads.
“While the ban on crypto ads across social media platforms may impact the level of engagement for new token-sale campaigns, there are alternative methods for promoting such projects. Serious investors will conduct thorough research and identify promising new crypto-currencies regardless of social media advertising,” he explained.