UK advertising body upholds complaints against cryptocurrency trading platform BitMEX

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The UK Advertising Standards Authority (ASA) has upheld a set of complaints against a newspaper ad for cryptocurrency trading platform BitMEX.

The ad in question was seen on January 3, 2019. The ad featured a graph spread across two pages. The horizontal axis was divided and labelled into six month units showing dates between January 2009 and January 2019. The vertical axis was labelled “Bitcoin Price In US Dollars” separated by decimal point value increments from $0.0001 to $100,000. The graph depicted a sudden rise in the value of Bitcoin after July 2010. The highest value recorded on the graph was of more than $10,000 between July 2017 and Jan 2018.

Text at the top of the left page stated “3 January 2009. Ten years ago today, the first block of the Bitcoin blockchain referenced the front page of The Times.” Text at the top of the right page stated “3 January 2019. Turns out, that was a pretty big deal.” Text in the bottom right corner of the graph stated “Source:Blockchain.com”.

The ASA received four complaints. Four complainants, who believed the ad exaggerated the return on the investment, challenged whether it was misleading. Two complainants, who believed the ad failed to illustrate the risk of the investment, challenged whether it was misleading.

The body considered that readers were likely to interpret the line of the graph to mean that there had been a sharp then steady rise in bitcoin’s value in its early years up to its peak in November 2017 followed by a gentle decline in recent years. However, bitcoin’s value had fluctuated dramatically in recent years from, for example, approximately: US $1,000 at the beginning of 2017 to US $14,000 in November of that year and then steadily back down again to US $4,000 at the time the ad was published in January 2019.

For those reasons the ASA considered that readers of the ad were likely to be misled about bitcoin’s value and stability in recent years and therefore about what any investments they might previously have made would have yielded.

In addition, the body did not consider that the text alongside the graph which stated that Bitcoin was “still very much an experiment”, that “the road ahead will be challenging” or “price volatility” mitigated the overwhelming impression about Bitcoin’s value created by the graph. In any case the full text stated “Despite price volatility and how entirely bonkers the system seems, the Bitcoin protocol appears robust. And although the road ahead will be challenging, there’s a reason to believe Bitcoin’s still got a chance at glory”. The ASA found that was a clear promotional statement of Bitcoin’s merits and did very little to warn consumers of any risks.

Hence, the ASA considered that the ad had misleadingly exaggerated the return on investment, failed to illustrate the risk of the investment and therefore concluded it was in breach of the Code.

The ad breached CAP Code (Edition 12) rules 3.1 and 3.3 (Misleading advertising), 3.11 (Exaggeration) and 14.1 (Financial products).

The body says the ad must not appear again in its current form. The ASA told HDR Global Trading Ltd, trading as BitMEX, to ensure that financial information in their ads was set out in a way that allowed it to be readily understood by the audience being addressed and that the risks of investments were sufficiently clearly signposted.

This is not the first time the advertising body upholds complaints against crypto ads. In October last year, for instance, the ASA found an ad by Crypto Bank Global to be misleading too.

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