Social media behemoth TikTok is moving forward with a ban on crypto promotions and advertisements. The platform has unveiled its updated branded content policy that could have serious implications for influencers who depend on the crypto sphere and financial sector to generate content.
To arrest the growing trend of crypto shilling on its site, TikTok has made drastic changes to its content policy that will prohibit all kinds of promotions and advertisements related to “Financial Services and Products”. This category includes, but is not necessarily limited to cryptocurrencies, forex trading, buy now and pay later services, credit cards, loans, and trading platforms.
Meanwhile, TikTok’s advertising policy for financial services, which dictates that companies are allowed to target users above the age of 18 years, is unaffected by the changes. Advertisements for digital assets, however, are prohibited until further notice.
The real problem here lies with the influencers who are paid a commission for hyping certain cryptocurrencies, exchanges, DApps, and other blockchain-based products. This is especially concerning since TikTok is fast evolving into a financial information portal for young consumers.
While the new ban would certainly impact some legitimate financial businesses, it would address the unregulated financial advice offered by content creators. Additionally, crypto businesses that have leveraged TikTok’s global reach will also find it difficult to spread information, and without feasible options for promotion, the days of crypto firms on TikTok may be numbered.
The change in TikTok’s content policy seems to be motivated by the criticism faced over the lack of regulation on irresponsible financial advice. The platform primarily caters to a young demographic that is also more likely to invest in digital assets and sees TikTok as a legitimate source of financial information. This makes them susceptible to scams that can leave them in the throes of lasting financial troubles.
However, cryptocurrency shilling is not limited to TikTok as the practice is widespread on social media. And sometimes it has disastrous consequences for both the influencer and investors. Take, for instance, the now infamous ‘Save The Kids’ token, which was promoted by some members of the FaZe clan, who could possibly face legal ramifications for their involvement in the alleged pump-and-dump scam.