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Facebook has said it will ban ads related to financial products and services like cryptocurrency, binary options and initial coin offerings.
The move is a bid to “improve the integrity and security of [Facebook’s] ads”, as it believes that many companies promoting cryptocurrrency are scams and not operating “in good faith”.
Facebook has issued a ban on cryptocurrency ads for fear of scams
With its technical jargon and complicated premise, cryptocurrency is a natural medium for scammers to lure in the uninformed. Initial coin offerings (ICOs) — which offer buyers the chance to get in on a new cryptocurrency before launch — provide a barely-regulated avenue for scammers to grab money and disappear.
For now, any Facebook ad involving these products will be banned in a policy that will reach all Facebook-owned platforms, including Instagram. The company says it needs time to “better detect deceptive and misleading advertising practices”.
The sweeping change points to Facebook’s inability to detect scams in the products its platforms promote. This is particularly worrying as Facebook alone has over two billion users and generated over US$10-billion in revenue in the third quarter of 2017.
The sweeping policy change points to a glaring flaw in Facebook’s ad review process
All ads that appear on Facebook are subject to review, but this review focuses on the ad rather than the product. Among others, the company considers the text and images used, if the ad should be age-restricted, or if the ad violates community standards.
In its advertising policy, the company bars the use of “misleading or false content“, but this is mostly targeted towards clickbait language like “earn 15% profit every two weeks”. It does, however, okay the line “earn profit every two weeks”.
Now, language like “New ICO! Buy tokens at a 15% discount NOW!” and “Use your retirement funds to buy Bitcoin!” will no longer be permitted.
Feature image: Andre Francois via Unsplash