The UK advertising watchdog has banned ads by Premier League football club Arsenal promoting its fan tokens amid a crackdown on crypto content. The Advertising Standards Agency (ASA) took issue with an advert published on Arsenal’s Facebook page in August, which encouraged people to buy $AFC fan tokens in order to vote on minor decisions made by the club, such as which song to play when Arsenal wins a game. The regulator accused Arsenal of taking advantage of inexperienced investors, trivialising digital asset investment, and failing to make it clear that fans wishing to buy the $AFC tokens would first have to purchase another crypto asset.
“We told Arsenal Football Club PLC to ensure that their future ads did not trivialise investment in crypto assets and did not irresponsibly take advantage of consumers’ lack of experience or credulity by not making clear that Capital Gains Tax could be due on crypto-asset profits,” the ASA wrote in a statement, ruling that “the ads must not appear again in the form complained about.”
A spokesperson for Arsenal speaking to the Financial Times stated that the club takes “responsibilities with regard to marketing to our fans very seriously. We carefully considered the communications to fans regarding our promotions and provided information regarding financial risks.”
“We will endeavour to comply with the ASA’s guidance regarding future communications in this fast-moving area, however, we will be seeking an Independent Review of the ASA’s ruling,” the spokesperson added.
The ASA, meanwhile, states that although the tokens were not advertised as financial products, Arsenal should have indicated that crypto assets were unregulated in the UK, as it meant that the products did not carry consumer protections that come with many regulated financial vehicles.
In defence of its fan token promotional, Arsenal pointed to information about investing provided on the fan token section of its website which included a warning not to spend more than fans could afford to lose and explained that the price of assets may be volatile. The football club also pointed out that the requirement to tell fan token holders to pay capital gains tax went beyond FCA standards for regulated investments.
The ruling comes amid an ASA campaign against crypto adverts with the watchdog this month raising a ‘red alert’ about the issue. Last week, pizza chain Papa John’s, Coinbase, and eToro were all called out by the regulator which banned ads that failed to adequately explain the risks of investing in crypto.
Meanwhile, fan tokens have surged in popularity among football clubs in Europe with Socios alone creating tokens for more than 40 football clubs including the likes of Paris Saint-Germain, Juventus, and Manchester City. With football club revenues getting hit by the ongoing pandemic, fan tokens have quickly emerged as a go-to option to add funds for clubs, while offering fans a way to connect with their favourite club in a more meaningful way.
Cryptocurrency is an unregulated digital currency, not a legal tender and subject to market risks. The information provided in the article is not intended to be and does not constitute financial advice, trading advice or any other advice or recommendation of any sort offered or endorsed by NDTV. NDTV shall not be responsible for any loss arising from any investment based on any perceived recommendation, forecast or any other information contained in the article.
