France is considering prohibiting influencers from producing crypto promotions in order to protect consumers from fraud and scams via a proposed amendment to Bill 790. The ban also includes advertisements of financial products, gambling, video games, health products, and other forms of “excesses” by these individuals or groups. While the proposed legislation is aimed at safeguarding consumers, it could have a significant impact on both the cryptocurrency market and influencers.
Impact on the Cryptocurrency Market and Influencers
Social media platforms have played an important role in promoting and raising awareness about cryptocurrencies over the years. Likewise, many people have made investment decisions based on information they obtained through them. Therefore, the proposed ban could have a profound effect on the crypto market and influencers who have relied heavily on social media platforms to promote and raise awareness about the good and the bad sides of these digital coins.
Along the way, the prohibition could also create a negative perception of cryptocurrencies among the general public, which could potentially decrease their adoption and usage in France. Additionally, this could lead to a shift in the way crypto influencers and companies market their products and services, as they may need to find alternative ways to reach their target audience.
Fines and Penalties for Violating the Amended Bill 790
The planned amendments come with fines and penalties for individuals or entities who violate the law. According to the proposed legislation, sanctions could reach 30,000 euros plus a two-year prison sentence. The hefty fines, especially for repeated violations, could result in major financial losses and reputational damage for those who violate the law.
Exemptions to the Rule
The proposed changes in the law provide some exemptions though. Crypto asset promotions approved by the Autorité des Marchés Financiers (AMF) are not covered by the ban. But then again, there are no clear rules pertaining to the registration of crypto promotions in France by influencers as of yet. Likewise, no influencer or promoter has ever applied for one.
Enforcement Challenges and Potential Impact on Cryptocurrency Adoption
Some experts argue that enforcing the ban and imposing the mentioned fines could prove to be difficult. Social media platforms are global in scope and most aren’t under the jurisdiction of French laws. These make it challenging to enforce the restrictions and impose penalties on violators. The move could result in the limited effectiveness of the prohibition, and influencers may continue to promote and trade cryptocurrencies on social media platforms outside of the oversight of French authorities.
Moreover, while the legislation may protect consumers from fraudulent activities, it could also limit the wider dissemination of the potential benefits of cryptocurrencies to them. They could miss out on trends, news, and educational content detailing the benefits of these digital currencies, such as their decentralized nature, immutability, and capability to facilitate fast and secure transactions.
Lastly, many crypto-focused contents on social media come with a disclaimer that they do not serve as financial or investment advice. Lawmakers may find it hard to penalize people who do not present their content as such.
Final Thoughts
While the proposed ban and fines may have the intended effect of protecting consumers from fraud and scams, it remains to be seen how effective they will be in practice, and what their ultimate impact on the cryptocurrency market and influencers will be. The restrictions could create challenges for cryptocurrency influencers and companies, while also limiting the potential benefits of cryptocurrencies in France.
The developments of the amendment’s deliberation and its impact on the cryptocurrency market will likely be closely monitored by industry experts and stakeholders in the days to come.