Other cryptocurrency firms have also come under scrutiny when the well-known Singaporean cryptocurrency trading platform Vauld halted all of its activities. The decision was made amid India’s currently tumultuous cryptocurrency industry. Several Indian YouTubers and financial celebrities that many young investors follow pushed Vauld.
The cryptocurrency platform has stated that it has halted taking new deposits and withdrawals after running out of cash while continuing to discuss with financial and legal organizations how to resume normal operations. Vauld attributed this choice to the erratic market environment. According to Shivaji Dasgupta, founder and managing director of INEXGRO Brand Advisory, there is not much that influencers can do to screen the businesses they promote in the current regulatory climate. Except for verifying the platform’s moral and legal standing. Particularly in this proliferating start-up and direct-to-consumer (D2C) environment, where performance evidence is non-existent.
A further layer of self-regulation by ASCI is something that can and must be done so that influencers can only be approached after a minimal amount of time in the company, continues Dasgupta. The Securities and Exchange Board of India (SEBI) recommended in May 2022 that no “prominent public figures,” such as athletes or celebrities, should support cryptocurrency items and that the marketing disclosure should include discussing any legal violations. According to ASCI, in June 2022, social media influencers in the nation will be responsible for 92 percent of all crypto advertising violations that took place between January 2022 and May 2022. The violations included forgetting to include disclaimers about cryptocurrency trading and tags indicating that a particular post was part of a compensated arrangement. No matter the category, Rishabh Mahendru, VP, Client Servicing, AdLift, notes that influencers must disclose that they are endorsing a business in a specific video for which they have received payment.
According to Mahendru, “when there is a lot of rivalries and rapid growth, it becomes vital for marketers to think of ideas to produce a lot more long and short-form instructional material, which may educate the audience about the uncertainties about the category and market.” A popular advertisement released by Vauld in October 2021 was titled “For Everything Crypto Just Vauld.” The platform’s decision to enlist well-known financial influencers contributed to its popularity’s continued rise. Influencers like Booming Bulls, Ankur Warikoo, PR Sundar, and Akshat Srivastav reportedly contributed promotional content regarding the platform. According to Dasgupta, marketers always use the category narrative as the value proposition for early adopters in any new category.
The brands would invariably die a natural death if the category itself is off-limits for commercial or legal reasons, according to him. Marketers are therefore kind of forced to plan and hope that the category doesn’t fail or fall into the trap of speculative overpromising. The marketers will need to move quickly as waiting and watching is not an option due to the intense business demands.
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