SEBI recommends that showbiz stars and athletes, public and political figures refrain from supporting projects related to the digital asset industry. The Indian regulator explains that Cryptocurrency products in the local market are not regulated, and some may even violate existing laws:
“Given that Crypto products are not regulated, prominent public figures, including celebrities, athletes and so on, or their voice should not be used to endorse/promote Crypto products”.
SEBI recommends that the Parliamentary Committee on Finance provide penalties for Cryptocurrency advertising prohibited by the Advertising Standards Council of India (ASCI). SEBI warns media personalities of liability for promoting Cryptocurrency projects that violate the Consumer Protection Act, the Foreign Exchange Management Act (FEMA), the Prohibition of Unregulated Deposit Schemes (BUDSA) and the Prevention of Money Laundering Act (PMLA).
Under the Consumer Protection Act of 2019, misleading individuals can be fined up to 10 lakhs ($12,840) to 50 lakhs ($64,210). This would result in a ban on any advertising campaign for three years. SEBI suggested rephrasing the disclaimer prescribed by ASCI, adding that “Cryptocurrency transactions could lead to prosecution for possible violations of Indian laws such as FEMA, BUDSA, PMLA”.
In late 2021, it was confirmed that Cryptocurrency regulation laws in India do not prohibit cryptocurrency advertising or restrictions on celebrity promotion of Cryptocurrency products.