Britain's advertising watchdog rebuked soccer club Arsenal on Wednesday over website and Facebook ads of its "fan tokens," a type of cryptocurrency that has exploded in popularity this year.
The Advertising Standards Agency said two ads posted by Arsenal in August were "misleading" as they failed to make clear the risk of trading cryptocurrencies, of potential tax implications, or that such tokens are unregulated in Britain.
It said the ads must not appear again in the same form.
Fan tokens allow supporters of a variety of soccer and other sports clubs to vote on minor decisions such as the song played at matches after a goal is scored or images used on social media.
The tokens, which can be traded on exchanges like other cryptocurrencies, are prone to wild swings in price and often have little connection to on-field performance. North London-based Arsenal ran promotions on its website and Facebook promoting the tokens, the ASA said, with details of how supporters could buy the tokens via a separate cryptocurrency.
The ASA said Arsenal's ads were "irresponsible because they took advantage of consumers' inexperience or credulity and trivialised investment in cryptoassets."
An Arsenal spokesperson said it was seeking an independent review of the ruling, and that it would "endeavour to comply" with the watchdog's guidance.
"We take our responsibilities with regard to marketing to our fans very seriously," the spokesperson said. "We carefully considered the communications to fans regarding our promotions and provided information regarding financial risks."
Arsenal had told the ASA that fan tokens were designed to boost participation by supporters, and were "materially different" to other cryptocurrencies used as a means of payment.
It is one of several sports club resorting to alternative revenue sources to counter the pandemic, which according to consultancy Deloitte has fuelled a 12% drop in earnings at Europe's top 20 clubs during the last season.so
Many fans and supporter associations have dismissed the tokens as offering only superficial participation that adds to the already growing costs of following their teams. Others, however, say they appreciate a novel way to engage with their teams.
