Spain will regulate influencers promoting cryptocurrency

Illustration by James Bareham / The Verge

Spain has announced new rules for how social media influencers and others can advertise cryptocurrency assets, Reuters reports. Starting next month, the Spanish National Securities Market Commission (CNMV) will require people and companies to notify it at least 10 days before running campaigns for crypto assets. The rules apply to influencers with more than 100,000 subscribers who are paid to promote cryptocurrency — a practice that’s drawn criticism and even lawsuits worldwide.

According to Reuters, crypto advertisers will need to release the content of their upcoming campaigns to the CNMV, and they must include warnings about the risks of what they’re selling. The rules are designed to let the CNMV monitor the marketing ecosystem around crypto assets and make sure audiences are aware of risks.

The CNMV has previously used social media to throw cold water on crypto hype. In November it replied to a tweet from professional soccer player Andrés Iniesta after he enthusiastically promoted the cryptocurrency exchange Binance, warning him that “cryptoassets, being unregulated products, carry some significant risks.” (It was unclear whether Iniesta had been paid for his promotion.)

Cryptocurrency and social media advertising are both areas with significant regulatory ambiguity, and the combination has sometimes proven troublesome. Earlier this month, a proposed class action suit targeted Kim Kardashian, boxer Floyd Mayweather, and others for promoting the currency EthereumMax — raising its price dramatically before the asset crashed into near worthlessness. The CNMV’s new rules won’t stop influencers from telling their followers about cryptocurrency, but they’ll let the agency keep closer tabs on what exactly is being offered.