Given the higher revenue potential from crypto space, Facebook has partially reversed its cryptocurrency ad ban effective immediately. The company had announced a strict ban on crypto ads in January this year given the fact that many companies didn't operate in good faith.
The Proviso of Facebook's U-Turn
Facebook has now updated its policy to allow ads that promote cryptocurrency and related content from pre-approved advertisers. But it will continue to prohibit ads that promote binary options and initial coin offerings (ICOs). All the companies seeking the ads will have to first pass a screening test conducted by the Facebook team. In this test, experts will ensure that no scams or misleading ICOs go through.
Rob Leathern, Product Management Director of Facebook said:
“Advertisers wanting to run ads for cryptocurrency products and services must submit an application to help us assess their eligibility — including any licenses they have obtained, whether they are traded on a public stock exchange, and other relevant public background on their business. Given these restrictions, not everyone who wants to advertise will be able to do so."
Last year, the price of bitcoin rose as high as $19,000 and so did the scams. The estimate by Federal Trade Commission (FTC) stated that during the first two months of 2018 end-users lost $532 million in scams related to cryptocurrency.
Following Facebook's decision to ban crypto ads, Google had also joined the league in March. Google asserted many companies as "unregulated and speculative" based upon the nature of their advertisement product. Twitter and Snapchat also restricted their usage around crypto ads.
The Policy Continues to be Work in Progress
“…We’ll listen to feedback, look at how well this policy works and continue to study this technology so that, if necessary, we can revise it over time,” Leathern added.
The revision in crypto ad ban is being welcomed by the crypto community. They also believe that Facebook might further relax its policies. It is also expected that other technology platforms will follow Facebook and announce an ad ban reversal soon.