Twitter has told Reuters that it will ban ads for ICOs and token sales. This policy is going to come into effect over a 30-day period. Other things that Twitter plans to ban are crypto exchanges and wallet services. However, if it is a public company listed on a major stock exchange, Twitter is going to allow it. For Japan, where crypto exchanges enjoy a favorable legal regime, Twitter is only going to ban exchanges that are currently under review by the regulator.
The Major Motivation
The main reason Twitter gave for this ban is the safety of its users. Twitter has already taken measures to ensure that crypto-related accounts do not engage with others in a manner which is deceptive. However, most have seen this as not being enough. There have been calls for Twitter to take further measures to protect users. These calls were stepped up after Facebook Inc. and Alphabet Inc. banned crypto on their platforms.
Effect on the Markets
The crypto markets have already been facing a tough time, and slipped quite drastically on Monday. When this announcement was made by Twitter, the markets slid even further. For the first time since it surpassed the $8,000 mark again, Bitcoin fell back below it. This slide is only likely to become worse in the coming days. Besides the risks to its users, the Director of Twitter, Zennon Kapron, was worried about the risk to the platform itself.
The directors said that there were so many ICOs being launched daily, it was impossible to verify each one of them. Unlike the stock markets, where an IPO will launch maybe once or twice a month, ICOs are churned out in their hundreds per month. Even major companies such as Google and Facebook simply lack the resources to verify that each ICO launched and advertised is genuine. This is especially the case considering that an ICO could launch from any territory in the world and be sold globally.
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.
Facebook banned crypto ads in January 2018. Google followed suit a short while later, and the ban will come into effect in June 2018. However, despite this deadline, Google already appears to have major restrictions on crypto. It has become quite common for crypto-related accounts to be banned permanently or have their campaigns deleted.
For now, it would appear that getting a crypto ad out there is almost going to be impossible. However, these measures are justifiable. In recent months, many people have been swindled by fake ICOs.
What do you think about this latest ban on crypto by Twitter? Leave us your thoughts in the comments section below.
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