Twitter to ban crypto ads as online crackdown widens

LONDON (Reuters) – Twitter is to ban cryptocurrency advertising, joining Facebook and Google in a clampdown on the industry over the risk of giving publicity to potential fraud or large investor losses.

The prohibition will cover advertising of initial coin offerings (ICOs) – crowdfunding used to raise cash by creating new coins – as well as token sales and crypto-wallet services, San-Francisco-based firm told Reuters.

The policy, whose implementation date was not announced, will also stop crypto-exchanges from advertising, with limited exceptions.

Twitter said this month it was taking measures to prevent crypto-related accounts from “engaging with others in a deceptive manner”, but had faced calls to go further after bans from Facebook and Google.

Facebook restricted crypto-related adverts in February, while Google announced a ban that comes into force in June earlier in March.

Regulators have stepped up warnings that bitcoin and other virtual currencies are highly speculative, some potentially fraudulent and that investors should be prepared to lose everything.

But last week the G20 group of rich nations failed to reach a consensus on how to supervise them.

“With the increasing number of ICOs coming to market it is an impossible task for anyone, much less platforms like Twitter or Facebook, to keep on top of which ICOs and cryptocurrencies are genuine versus frauds,” said Zennon Kapron, director of financial consultancy Kapronasia.

“Although certainly ICO advertising must have been a significant source of revenue for Twitter, the repercussions of fraudulent activities just weren’t worth the risk.”

The price of bitcoin has fallen more than half to around $8,000 from a December peak of almost $20,000 BTC=BTSP, as fears of a regulatory clampdown spooked investors. News of the Facebook and Google bans also knocked the price.

Cryptocurrencies Ethereum .MVETH and Ripple’s XRP .MVXRP have tumbled this year too.