Stop the Spam: Why Google and Facebook's Ban of Cryptocurrency Ads is a Good Thing
How do you know if a person or company promoting crypto is legitimate?
First Facebook, then Google announced the banning of cryptocurrency and initial coin offering (ICO) advertisements. Now, Twitter is reportedly following suit. ICOs are a way for cryptocurrency companies to raise funds for a new venture using cryptocurrency rather than shares of stock on a public exchange. Backers exchange money or other cryptocurrencies for company tokens – that is, as long as the cryptocurrency companies behind the ICOs are legitimate.
While the cryptocurrency industry has been around for several years, the rise of bitcoin in 2017 turned a lot of heads with both industry insiders and people who may have never paid attention to cryptocurrency before. Because of the excitement, some people and companies looking to make a quick buck, began taking out ads on the internet and social media to reach investors for their ICOs, which may not have been entirely sincere.
You would think the ad ban would be bad for cryptocurrency companies that may still be considering legitimate ICOs, but it is not. Instead, it’s actually a good thing for the industry, and here’s why:
REDUCING THE BAD ACTORS
There are many legitimate cryptocurrency companies looking to welcome and educate people interested in the industry, but bad actors in this space are bringing negativity to the industry. A recent report by bitcoin.com explained 59 percent of last year’s ICOs are either “confirmed failures or failures-in-the-making.” It reported the teams seeking the crowdsales either stopped communicating with their audience or the company’s community is so small it had no chance of success.
While some companies are using social media and the web as a platform to advertise and raise millions of dollars for their ICOs, there are also many opportunists who call themselves cryptocurrency experts and then spam audiences on social media with ads. Removing these ads altogether makes it more difficult for questionable people and companies to take advantage of people new to the industry.
NO MORE SPAM
Recently, ads ran on Facebook promising massive cryptocurrency investment returns of 100 percent within 30 days. Because cryptocurrency insiders would be onto this, these fake companies, instead, targeted novices for support. Many of the companies running the ads had no product behind them. In some cases, they would put fake teams together to make newcomers think the company was real.
Legitimate cryptocurrency companies don’t need to spam with ads to be successful. They are community-focused and engage directly with their audience via Discord, Telegram and Twitter, answering questions about their mechanism that people are excited about.
Spam advertisements for ICOs just make the whole industry look bad. Doing away with them will help legitimate cryptocurrency businesses thrive.
PRIME OPPORTUNITY FOR EDUCATION
The popularity of the ads demonstrates the need for valuable and reliable content in this industry. With the ads banned, it is a prime opportunity for leaders in cryptocurrency to take time to educate. In turn, the timing is perfect for newcomers to learn more about this emerging technology and currency of the future.
How do you know if a team promoting a cryptocurrency or ICO is legitimate?
See if the teams have open conversations on social media about their mechanisms and processes. If they are silent or only talking about the project and funding, those should be considered red flags. Also, search the individual team members online. Do multiple outlets or websites confirm their backgrounds and areas of expertise? If you find little to no information, then move on to another team of interest.
Additionally, look at cryptocurrency resources to learn about the industry. Many major cities offer meetups featuring experts who want to share knowledge on this topic and the blockchain technology behind it. Online sources like Cointelegraph offer fact-based cryptocurrency news on a daily basis. And Crypto-City.com is a site that our company, Jalapeño Inventive, uses to offer education like TED Talks, videos and a forum on cryptocurrency.
By eliminating the bad actors and “spammy” ads, this is a great time for our industry to move forward in a positive direction, allowing leaders to educate the public in cryptocurrency, which is only going to become more established in the future.
Aari Lotfipour is the co-founder and CEO of Jalapeño Inventive. In 2014, he helped launch the company in Fort Collins, with the desire to make cryptocurrency accessible to the masses.