ASA Shows Red Card To Arsenal Again In High Stakes Game Of NFTs
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The Advertising Standards Authority is wearing the referee shirt in the high-stakes game of crypto trading and has once again shown the red card to Arsenal football club for flogging tokens without high-risk warnings attached.
By Susannah Streeter, senior investment and markets analyst, Hargreaves Lansdown
It’s cried foul on the club for not making it sufficiently clear that the value of investments in paid-for Fan Tokens was variable and that the crypto assets were unregulated.
It’s not the first time the ASA has censured the club for its crypto promotions. Late last year it banned the club’s posts on Facebook and its website which promoted ‘fan’ tokens as they took advantage of consumers’ inexperience in crypto assets and misled consumers by not making it clear that these NFTs had to be bought using another cryptocurrency.
NFTs, which have been described as modern-day trading cards, are seen as valuable streams of fresh revenue for football clubs, and for soccer stars who have been promoting other schemes. But with the value of crypto coins and tokens crashing in spectacular fashion in the last few months, as a wave of anxiety gripped financial markets, it’s left many hopeful fans in the stands clutching NFTs with hefty losses.
ASA officials are faced with the task of running the line, assessing every complaint against companies, but with scant other regulation governing crypto assets, and so many flags springing up it’s becoming an increasingly difficult play to monitor. This ruling is another stark reminder that people should resist ploughing money into schemes they don’t fully understand and should only speculate with money they can afford to lose. It also highlights the need to speed up the plan to give the city watchdog – the Financial Conduct Authority more powers to regulate the crypto industry, given the government’s vision to make the UK a crypto hub.
The rollercoaster ride of NFTs is set to continue given that the tokens are also highly sensitive to the fortunes of the stock market. Although some closely watched crypto assets have risen slightly in value in recent weeks, up from the lows reached in mid-June, Bitcoin and Ether are still down by around 65% since the heady heights reached in November last year. Despite continued volatility, NFTs continue to be churned out across the sport, art and music worlds, many with the backing of organisations or individuals with huge social media followings. A token may appear to be set for a winning streak – but after the initial frenzy of interest, NFTs could end up being almost worthless, in the same way as once sought-after CDs, vinyl or even popular football players have ended up in the bargain bin.
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