With the recent highs of Bitcoin and other cryptocurrencies, several companies are hiring influencers to promote their businesses in the sector. The big problem is that this partnership can be done in a hidden way, as well as deceiving those who have less knowledge.
As a result, France created a task force to combat this type of promotion. The team has agents from two French agencies linked to consumer protection and the financial market.
As an example we can cite the case of Kim Kardashian who, after promoting a suspicious cryptocurrency, came under the radar of UK authorities. As you can imagine, cryptocurrency plummeted and left many at their loss.
Focus on crypto influencers
Full of followers, many of them with no knowledge of the financial market, influencers’ social networks are the ready recipe to promote scams, whether from cryptocurrencies or from services around them.
Promises of quick profits, past reports that have no connection with the future, hidden partnerships and non-existent connections are the main lures of these promotions.
“Reality TV attendees often promote highly volatile cryptocurrencies and financial products, which are very difficult for newcomers to anticipate fluctuations.”
The sentence above is from the DGCCRF, the French body responsible for consumer protection and fraud prevention.
In other words, while influencers earn thousands of reais due to their numbers of followers, the latter are the only ones taking risks. After all, these influencers’ lives will remain normal, even if their posts make someone lose everything they have..
Influencers take advantage of lack of market knowledge
As published by The world, France’s Financial Markets Authority (AMF) believes the biggest danger is the lack of knowledge among young people. In other words, they think it’s a safe business, but there are many risks.
“Social networks and influencers are the new gateway that has emerged in recent years. In this way, the target is a younger audience, with more modest training, especially in trading.”
Thus, the focus of this new task force is to reprimand these cryptocurrency influencers who promote such content. Le Monde also highlighted the case of influencer Nabilla Benattia-Vergara, who was sentenced to pay a fine of 20,000 euros for secretly promoting a nebulous Bitcoin exchange.
In Brazil, everything still looks like an old west when it comes to protecting the consumer. Recently, the influencer Diego Aguiar was accused by the community of manipulating a cryptocurrency game, which practically died after the episode.
If you don’t want to fall for scams like CryptoEats, it is recommended that you do your own research, investing in this market only when you feel comfortable making decisions on your own.