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Facebook has backtracked on its blanket ban on cryptocurrency ads, saying it will now accept them from pre-approved advertisers in certain circumstances.
Back in January, the company pulled the plug on ads such as binary options, initial coin offerings and cryptocurrency that, it said, were ‘frequently associated with misleading or deceptive promotional practices’.
Now, though, the company has announced that it’s set up a vetting process and that advertisers that come up to scratch can now promote some crypto products – though ads for binary options and initial coin offerings (ICOs) are still banned.
“Advertisers wanting to run ads for cryptocurrency products and services must submit an application to help us assess their eligibility — including any licenses they have obtained, whether they are traded on a public stock exchange, and other relevant public background on their business,” explains product management director Rob Leathern.
The move isn’t a surprise – at the time of the original ban, Facebook stated that it would be revisiting its plans. And with cryptocurrencies rather less volatile than they were at the time, the company may see less of a need for a total ban.
It remains to be seen how the rest of the industry reacts. Google announced its own ban on cryptocurrency ads in March, with Twitter following suit shortly after. Microsoft, meanwhile, has continued to allow them all along.
Some in the industry expect to see them soften their stance too.
“It’s not surprising to see Facebook walk back its policy on crypto ads, but it’s much sooner than the market expected,” says Chris Yoo, portfolio manager at crypto hedge fund Black Square Capital.
“We expect policy decisions from Google, Twitter and other social networks to follow suit as cryptocurrencies earn greater legitimacy, credibility and perceived value.”
And Facebook may have another motive for softening its stance on cryptocurrencies. The company’s been rumored to have considered buying cryptocurrency exchange Coinbase, and recently announced the creation of an internal group tasked with exploring the opportunities of blockchain.
The group will be headed by David Marcus – former head of Messenger – and will, he said at the time, ‘explore how to best leverage Blockchain across Facebook, starting from scratch’. Some have interp[reted this as meaning that the company plans to develop a cryptocurrency of its own.
Either way, this latest announcement on cryptocurrency ads may not be the last. Even with a total ban, ads have been sneaking through by, for example, misspelling crucial terms. Softening the ban will undoubtedly leave more grey areas, and allow more ‘banned’ ads to slip through. Meanwhile, many advertisers are likely to feel unfairly discriminated against.
“Given these restrictions, not everyone who wants to advertise will be able to do so,” says Leather. “But we’ll listen to feedback, look at how well this policy works and continue to study this technology so that, if necessary, we can revise it over time.”
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