The Securities and Exchange Board of India (SEBI) has urged legislators to ban media personalities from promoting products that may violate the law amid rising fraud in the crypto industry.
SEBI recommends show business stars and athletes, public and political figures to refrain from supporting projects related to the digital asset industry. The Indian regulator explains that crypto-currency products in the local market are not regulated, and some may even violate existing laws:
“Given that crypto products are not regulated, prominent public figures, including celebrities, athletes, and so on, or their voice should not be used to endorse/advertise crypto products.”
SEBI is recommending to the Parliamentary Committee on Finance to penalize cryptocurrency advertising banned by the Advertising Standards Board of India (ASCI). SEBI warns media personalities to be held accountable for promoting crypto-currency projects that violate Consumer Protection, Foreign Exchange Management (FEMA), Unregulated Deposit Schemes Prohibition (BUDSA), and Prevention of Money Laundering (PMLA) laws.
Under the Consumer Protection Act 2019, misleading persons can be fined up to 10 lakhs ($12,840) to 50 lakhs ($64,210). This will result in a three-year ban from any advertising campaign. SEBI offered to rephrase the disclaimer ordered by ASCI by adding that “cryptocurrency transactions may result in prosecution for possible violation of Indian laws such as FEMA, BUDSA, PMLA.”
At the end of 2021, it was confirmed that crypto regulatory legislation in India does not prohibit advertising of cryptocurrencies and does not contain restrictions on the promotion of crypto products by celebrities.