Twitter, Instagram, TikTok and YouTube could face regulatory action in the European Union over the promotion of cryptocurrencies. The European consumer organization BEUC, an umbrella group for 46 independent consumer organizations from 32 countries, has filed a complaint to European Commission and consumer authorities that the platforms allegedly facilitate the misleading advertisement of crypto assets.
According to the complaint, misleading content from advertising and influencers exposes consumers to serious risks including financial losses. It said the Consumer Protection Cooperation Network should mandate social media companies to tighten their policies and prevent influencers from promoting crypto.
Last month, the European Union (EU) adopted the world’s first comprehensive set of rules for crypto asset regulation (MiCa).
In its joint complaint with nine of its members, BUEC said the network should inform the European Commission about the effectiveness of these measures.
"Crypto will be regulated soon with the new Market in Crypto Assets Regulation but this legislation does not apply to the social media companies benefiting from the advertising of crypto at the expense of consumers," BEUC Director General Monique Goyens said in a statement.
The group called on European consumer authorities to cooperate with European Supervisory Authorities for financial services to ensure the social media platforms change their policies to avoid the misleading promotion of crypto.
The move comes after the US authorities said they would sue trading platforms Coinbase and Binance, raising concerns over consumer safety regarding crypto assets.
On the other hand, in France, the Senate passed an amendment permitting registered crypto companies to hire social media influencers for advertising and promotional purposes.