Several crypto firms are facing an investigation by the United States Federal Trade Commission (FTC) over possible misleading or misleading advertisements regarding cryptocurrencies.
According to a December 6 report of Bloomberg, FTC spokeswoman Juliana Gruenwald said the watchdog is investigating “several companies for possible misconduct regarding digital assets.”
Gruenwald did not provide further details about which companies were under investigation or what prompted the investigation.
However, misleading advertising and promotion has been a trending topic in the United States this year.
In October, reality TV star Kim Kardashian was fined by the U.S. Securities and Exchange Commission (SEC) for “social media touting” the EthereumMax (EMAX) crypto token without disclosing that she was paid $250,000 to promote it.
In November, NFL quarterback Tom Brady and NBA point guard Stephen Curry were reportedly among a group of celebrities facing a investigation by the Texas financial regulator for their promotion of the now bankrupt crypto exchange, FTX.
The FTC is an independent United States agency established to protect the public from deceptive or unfair business practices through law enforcement, research, and education.
Earlier this year they sent a crypto scam alert with three key components, an impersonator, a QR code and a crypto ATM where victims will be directed to send money.
They also revealed in a June 6 report nearly half of all crypto-related scams come from social media platforms in 2021, and up to $1 billion worth of crypto has been lost to scammers throughout the year.
Cointelegraph has contacted the FTC for comment, but has not received a response as of press time.
Globally, several financial watchdogs and law enforcement agencies have also been actively trying to curb deceptive crypto advertisements.
In March, the UK-based Advertising Standards Authority (ASA) Published an enforcement notice to more than 50 companies advertising crypto, asking them to review their ads to make sure they follow the rules.
In August, the American consumer monitoring group Truth in Advertising called 19 celebrities for allegedly promoting non-fungible tokens (NFTs) without disclosing their connection to the projects.
Australia’s financial regulator has also fired warning shots at the crypto industry over misleading advertising tactics.
In October, the Australian Securities and Investments Commission (ASIC) instituted civil proceedings against Australian company BPS Financial Pty Ltd (BPS) for “misleading” claims regarding its Qoin token.