ADVERTISEMENT ON CRYPTOCURRENCY WILL NOW FACE THE CNMV’s FILTER
Five years ago, the discussion on cryptocurrency was maybe typical among conspiracy theory fanatics. It was the debate the anarchist friend would forcedly push into a conversation. The traditional investor disregarded the subject quickly, assuring there was no difference whatsoever between investing in crypto or going crazy in Las Vegas.
Today, the crypto-fever has spread quicker than a global pandemic. It is no longer the chatter of an anarchist friend, but the serious recommendation of a professional with investing experience. It has certainly reached surreal heights when the richest man in the world frantically tweets about a digital coin with a dog’s face on it and openly promotes investing in decentralized money, seducing millions to immerse themselves in the encrypted parade.
Financial institutions did not take long to react. On a European level, the BCE president, Christine Lagarde, called for a global regulation on Bitcoin due to it being a “highly speculative” asset, and the European Commission recently published the first proposal in history to regulate Markets in Crypto Assets (“MiCA”). All around, it seems like authorities are clumsily running against the clock, trying to mitigate the inevitable effects of a technology they cannot believe where naïve enough to underestimate.
In Spain, the apple has not fallen far from the tree. The National Stock Market Commission (the “CNMV”) is doing everything in its power to drag the crypto sector under its threshold of control, which is a tough challenge when considering that Spain is the number one EU investor in cryptocurrency. On this sense, a CNMV reaction was surely to be found if Bit2Me’s “BITCOIN, welcome to the revolution!” was the casual advertisement they chose for Madrileños’ walk around the block.
On March 12, a few weeks following the advertisement campaign, and after repeated official communications issued by the CNMV, which warned on the high risks associated with investing in cryptocurrency, the Spanish government approved an emergency reform to the Spanish Stock Market Law (Royal Decree 4/2015, the “LMV”). The next day, this reform was published in the National Gazette (B.O.E.) and a new article was added to the LMV under the pretext of equating crypto assets to other financial instruments such as bonds. In order to “subject to administrative control the advertising of crypto-assets and other assets and instruments, which are not regulated by the Stock Market Law and which are offered as investment proposals”, the legislative authorities published article 240 bis of the LMV. The article’s main objective is to empower the CNMV with the authority to outline the prerequisites any publicity on cryptocurrency has to comply with before getting out to the public. Not only that, but now, the CNMV can also remove from the public’s sight any advertisement they deem as fraudulent or misleading.
Today, March 18th, 2021, the CNMV published in its website their 2021 schedule. In the last page, the institution establishes that during this year they will prepare an official notice addressing the issue on cryptocurrency advertisement. As for now, the details are scarce, but businesses revolving around this new sector must remain aware and not wait for the CNMV notice to be published in order to start to anticipate. Any advertisement businesses decide to campaign with, should previously go through the filters that regulate publicity on traditional financial instruments according to article 240 of the LMV.
Nonetheless, one thing remains for sure… like it or not, Bit2Me got what it wanted. Their advertisement was controversial, and now they appear as the revolution’s lead against Big Brother-CNMV and their totalitarian quest to “suppress” financial freedom. Whatever side you are on, it is certainly an exciting sight to witness from a lawyer’s perspective.