Australian and US digital asset lawyers told Cointelegraph that words alone are “pretty useless.”
Cryptocurrency influencers may need to practice what they preach and “do their own research” when it comes to sharing their crypto tips.
According to some digital asset lawyers, the popular “This is not financial advice” disclaimer may not really protect them in the eyes of the law.
US-based securities attorney Matthew Nielsen of Bracewell LLP told Cointelegraph that while it is a “best practice” for influencers to disclose that “this is not financial advice,” they simply say that the term it does not protect them from the law, since “federal and state laws”. Securities laws largely regulate who can provide investment advice.
Australian financial regulation lawyer Liam Hennessy, a partner at Gadens, explained that “advisory warnings” are “generally quite useless”, while Australian digital lawyer Michael Bacina of Piper Alderman added that they are not “magic words that if pronounce grant, renounce”. . responsibility.”
Crypto influencers and celebrity ambassadors are increasingly coming under regulatory scrutiny, especially in the United States.
Nielsen cited the recent Kim Kardashian case as an example, where the SEC charged Kardashian with failing to disclose how much she received for promoting EthereumMax (EMAX) to her followers.
Influencers feel the pressure
Crypto influencer Mason Versluis, also known as Crypto Mason, who has over a million followers on TikTok, told Cointelegraph that he cannot stress enough to his followers that his content is not “to be taken as advice.” financial”.
Versluis, however, said that despite the “This is not financial advice” disclaimer, it’s important for influencers to know that some people “make financial moves based on what certain influencers say.”
He also emphasized how difficult it can be to determine if a project will end up in a “rug pull” situation, as influencers “just deal with the marketing team” and generally have no contact “with any of the developers or owners.” .
Australian crypto influencer Ivan Vantagiato, also known as Crypto Serpent, who has amassed 68,000 followers on TikTok, said that influencers should do their due diligence to research a crypto project before running a promotion.
Related: Australian Crypto ‘Finfluencer’ Faces Tough New Legal Restrictions
Hennessy believes that the best way for crypto influencers to protect themselves is to determine “which token is a security and which token is not a security.”
She went on to explain that it is critical to understand that a “derivative is a product that derives its value from something else” and that you can be “criminally liable” for promoting derivatives.
Meanwhile, Bacina noted that an influencer living in Australia must be licensed to provide financial advice and that “no exemption will provide protection.”
