The European Consumer Organization (BEUC) and its member organizations have issued a warning about the promotion of cryptocurrency on popular social media platforms like Instagram, TikTok, Twitter, and YouTube. In their report, titled 'Toxic Cocktail,' the BEUC criticizes these platforms for enabling scams and misleading promotions related to digital assets.
The report highlights the risks associated with cryptocurrencies and the prevalence of scams targeting unsuspecting consumers, particularly teenagers. The BEUC refers to the combination of social media networks, influencers, and cryptocurrency as a "toxic cocktail." It emphasizes the role of "finfluencers" who make unrealistic promises to attract users.
The watchdog group calls for stricter advertising policies and enforcement of consumer laws by the European network of national consumer authorities. It accuses the platforms of having loose policies that allow scammers to thrive. The BEUC argues that the misleading promotion of cryptocurrencies violates EU consumer laws.
Interestingly, European authorities have already taken steps to counter crypto scams through educational campaigns on social media in 2022. They aim to increase investor awareness and combat the negative impact of scams on the crypto industry.
The European Union has been actively regulating the crypto space, with the approval of the Markets in Crypto Asset (MiCA) legislation earlier this year. MiCA aims to bring more structure and regulation to the digital assets industry, addressing the "wild west" mentality associated with cryptocurrencies.
The BEUC's report serves as a call to action for European authorities to take further steps in combating crypto scams and protecting consumers. It sheds light on the risks involved in digital assets and the need for stronger regulations in the social media promotion of cryptocurrencies.