New advertising rules banning celebrity promotion should be extended outside of gambling and lottery adverts, personal finance experts have claimed.
Regulations unveiled by the Committee of Advertising Practice (CAP) this month, which come into effect in October, should also cover crypto and day trading apps, according to financial coaching app Claro Money.
“Whilst this regulation is welcomed, it does not go far enough, with crypto and day trading apps being as volatile and risky as gambling for many users,” said Alex Ford, chief marketing officer of Claro Money.
“We are not discouraging adults from taking part in crypto and day trading activities, however it is important that people are not encouraged to make high risk financial decisions without having access to more information.
Read more: UK crackdown on crypto advertising
“This also applies to the rise of the ‘finfluencer’ in which influencers are increasingly making social media content on financial topics despite not being well-researched or qualified to give advice. Videos on TikTok, using the #fintok alone have currently amassed 927.8 million views.
“Regulation by the CAP needs to go further to prevent people being influenced to make poor financial decisions. Removing the association between celebrities and crypto and day trading apps will reduce the number of people making investment decisions that can be harmful to their personal finances.”
The new CAP rules prevent sportspeople, celebrities and social media influencers promoting gambling and lottery adverts.
The new regulation states that gambling and lottery adverts must not “be likely to be of strong appeal to children or young persons” so anyone with this strong appeal, such as footballers or reality TV stars, is banned from appearing in these adverts.
Regulators and government bodies have been making efforts to crack down on consumer harm on social media platforms.
Las year, Financial Conduct Authority chair Charles Randell highlighted an Instagram post from Kim Kardashian for a crypto product that she was paid to promote to her 250 million followers, warning that such promotions could pose risks to consumers.
“In line with Instagram’s rules, she disclosed that this was an ad but she didn’t have to disclose that Ethereum Max – not to be confused with Ethereum – was a speculative digital token created a month before by unknown developers – one of hundreds of such tokens that fill the crypto-exchanges,” he said.
And last month, JustUs chief Lee Birkett welcomed the government adding a duty to the Online Safety Bill, which will force social media sites and search engines to stamp out fraudulent paid-for adverts.