TikTok has banned its users from promoting and advertising any kind of financial services on the platform. This includes loans, credit cards, cryptocurrency, trading platforms, share trading, and “buy now, pay later” offers, among other things. The ban also aims to crack down on pyramid schemes and “get rich quick” schemes.
TikTok has officially updated its branded content policy to prevent influencers from promoting financial services through partnerships with brands. The move to ban crypto promotions comes after a drastic rise in high-risk investments and financial frauds being promoted by social media influencers, especially on TikTok.
The ban will not affect TikTok’s advertising policy, which still allows legitimate financial services companies to advertise to anyone over the age of 18. Note that ads promoting cryptocurrencies and other virtual currencies are already banned.
The idea is to prevent influencers from misleading younger investors, who are more prone to following unfounded investment advice from “FinTok” accounts, which could get them into serious financial trouble. This is especially true when it comes to volatile cryptocurrencies.
TikTok is not the online company cracking down on crypto promotion as of late. Google also recently announced plans to ban savings and investments scam advertisements in the UK.
Starting the 30th of August, 2021, any company that wishes to advertise financial services on Google will have to prove that they are authorized by the Financial Conduct Authority (FCA), or qualify for a special limited exemption.
Warnings about fraudulent financial advertisements on Google and social media platforms like TikTok doubled in 2020 from the previous year. Crypto scams alone increased 1000% in less than a year, a trend that is sure to continue if companies don’t clamp down on fraudulent promotions.
Why Are Crypto Influencers Risky?
Crypto influencers receive payments and other benefits from risky cryptocurrencies and crypto trading platforms in exchange for promoting their brands via their TikTok accounts and other social media accounts.
This is extremely risky because they are purely incentivized by making money, without thinking about the potential risks of the investment and financial advice they are giving to others. Crypto influencers often have little to no actual knowledge of what they are promoting. In some cases, they are even scammers themselves.
Many crypto scams or fraudulent investment schemes start with influencers promising something that’s too good to be true. Users need to be wary of any type of investment advice that promises huge returns in a short amount of time.
Inexperienced, usually younger, investors who rely on social media and crypto influencers for their financial advice are more prone to making high-risk investments or falling victim to crypto scams that they are exposed to through platforms like TikTok. These financially vulnerable users are who the new TikTok ban aims to protect.
With the recent explosion in the popularity of volatile cryptocurrencies like Bitcoin, Dogecoin, and others, even celebrities have become crypto promoters. This is even more dangerous because of their vast reach and the trust that fans and followers place in them.
Crypto experts have noted that the only reason any celebrity is likely to be promoting crypto via their social media is because they have received free coins or another financial benefit from the crypto company for doing so. Celebrities are not authoritative sources of crypto information.
The recent ban by TikTok puts cryptocurrencies alongside other products influencers are not allowed to promote, including alcohol, tobacco, and pharmaceuticals, to name a few.
Despite the change in policy, hashtags like #fintok and #stocktok are still racking up the views on TikTok, so users need to know how to protect themselves from bad investment advice and crypto scams on the platform.
The easiest way to protect yourself is to simply not follow any financial advice or invest in crypto-based on something you see on TikTok.
However, if you do want to keep using TikTok as a source of crypto and investment information, just be on the lookout for anything that sounds too good to be true.
For example, don’t follow the advice of any TikTok influencer claiming that they have the secret recipe to make you a millionaire fast.
Always try to verify any information you hear on TikTok through reputable investment news sources or by talking to people you know who are more knowledgeable than you when it comes to investing.
Have You Fallen Victim To a TikTok Crypto Scam or Investment Scam?
Payback LTD’s goal is to help anyone who has fallen victim to online fraud, including TikTok crypto influencer and “fintok” investment scams. We know how devastating it is to discover you’ve lost your hard-earned funds because of these fraudulent accounts.
Our team of scam recovery experts consists of people who have worked in the financial industry for years, as well as cybercrime experts. We are committed to doing everything we can to help you recover your funds after being scammed.
We are fully dedicated to providing the best services to our clients and keeping them informed about ways to avoid the latest crypto scams and other types of online fraud. We aim to stay one step ahead of scammers and keep you right there with us.
If you’ve experienced significant financial loss because of fraudulent TikTok promotions or any other type of online scam, contact our compassionate team today. We’ll review your case, collect the evidence, and move heaven and earth to get your money back.
Learn more about “are there scammers on TikTok?”