Sunday, January 29

CNMV publishes circular on advertising of crypto assets and leaves out NFT

The CNMV, the Spanish regulatory body, has published its circular on the advertising control of crypto assets and seems to have left NFTs out. The text, published in BOE on January 10, states that advertising activity will not be considered, and therefore, “certain unique non-fungible assets” are excluded from the circular. In this sense, it adds that “white papers” are not included either, publications issued by independent analysts or commentators and that are not sponsored. The circular will enter into force on February 10.

CNMV and the advertising circular on crypto assets

The agency states that for the purposes of the circular, “those that are unique and non-fungible with other crypto assets, when they represent collectible assets, works with intellectual property or assets whose sole purpose is their use in games, will not be considered advertising activity on crypto assets.” or competitions, so that they are not offered massively as a mere object of investment».

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The regulatory body indicates that advertising campaigns aimed at more than 100,000 people, which it calls massive, will require the supervision of the CNMV. Although they are not massive advertising campaigns in the strict sense, certain obliged subjects may be required to provide prior notice for all their advertising campaigns. The affected party will have a period of three business days to meet the request.

Physical persons

In addition to including crypto-asset service providers, advertising service providers are also subject to the circular. As well as any other natural or legal person who, either on their own initiative or through third parties, carries out an advertising activity on crypto assets. For example, with the CNMV circular in force, Iniesta should have communicated to the regulator the tweet he launched last November about Binance. CNMV responded via tweet to the player, reminding him that what he was doing was not right.

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10 working days

CNMV highlights that all commercial communications must include the following message: “Investment in crypto assets is not regulated, may not be suitable for retail investors and the entire amount invested may be lost.” CNMV indicates that it must go in a relevant place in the advertising piece. The regulated entities that carry out massive advertising campaigns must provide, at least ten business days before their execution, a series of documents. Among them, the services that are going to be advertised, a description of the target audience and a list of the media and advertising media used for their dissemination.

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Likewise, they must present a copy of all the advertising pieces with a different message or format (radio spot, television commercial, banner, posters). The lack of presentation of the prior communication will determine the impossibility of continuing the affected advertising activity from the moment in which such facts are known, without prejudice to the responsibilities that may arise, indicates the CNMV.

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