The buzz around the digital currency in India doesn't seem to be dying. Despite high volatility and lack of government regulation associated with cryptocurrency, its exchanges are thriving. Flushed with investor funds, crypto startups are pumping in big money into advertising to attract users.
Take, for instance, the ‘Bitcoin Liya Kya’ advertisement from crypto exchange platform CoinDCX. It plays on internet’s favourite ploy FOMO (fear of missing out) to get users to download its app and become a part of the cryptocurrency investment craze. The ad shows young users showing how a smart investment in the most recognised cryptocurrency - Bitcoin, can make a difference in one’s life.
To be sure, cryptocurrency trading is the act of speculating on cryptocurrency price movements via a trading account, or buying and selling the underlying coins via an exchange. That is where most players in India such as CoinDCX, WazirX, CoinSwitch Kuber and Zebpay are playing, trying to get as many users to their platforms. Their TG includes digital and mobile-first users between 25 and 40 age group living in Tier I and II cities.
Unlike stock markets, cryptocurrency trading takes place 24x7, making conditions ideal for the digital-first, always-on connected generation.Crypto and cricket: Brands ride on India’s most popular sport
Most platforms’ marketing arsenal includes ads on video streaming platforms, social media, television as well as sponsorship deals for big events and high reach properties such as the Indian Premier League (IPL) and Big Boss.
WazirX, for instance, started advertising on IPL before the season got truncated. It also sponsored UEFA Euro 2020 and India Sri Lanka cricket tournament on Sony's over-the-top (OTT) video streaming platform SonyLIV.
Going by the data that’s publicly available, this strategy seems to be working. Indians had parked nearly $6.6 billion (Rs 49,189 crore) in cryptocurrencies until May this year, as compared to around $923 million until April 2020. The country ranks 11 out of 154 nations in terms of cryptocurrency adoption, as per blockchain data firm Chainalysis.
Mumbai-based business development manager Pranav Rawal, for instance, shifted crypto portfolio from international platform Binance to CoinSwitch Kuber after watching its ad during an IPL match.
“My long-term crypto investment (Bitcoins) is in WazirX which I got to know about through friends. My altcoins are in CoinDCX which I got to know about through Instagram, while CoinSwitch Kuber I discovered while watching a match,” he adds.
CoinDCX, for instance, is betting big on cricket properties. It has recently sponsored the inaugural ICC World Test Championship Final, as well as several T20 cricket series, notably the India-Sri Lanka T20I series, as the official title sponsor.
“As we want to grow our user base, cricket, particularly the T20 format, provides a good synergy for CoinDCX. We intend to use cricket to reach out to millennial and Gen-Z audiences, as they have expressed interest in cryptocurrency and are the most likely to invest in it,” Ramalingam Subramanian, head of brand and communication, CoinDCX, says. “On the over-the-top (OTT) video streaming platform Voot, we also sponsored the popular TV show Big Boss.”
Reel-ing in users: What happens when social media influencers promote crypto?
Apart from high-decibel television campaigns, these platforms, which are flushed with investor funds, have been heavily investing in content heavy explainer videos as well as influencer marketing on social media.
“Crypto exchange platforms are spending huge amounts of media money on user acquisition,” notes Ashutosh Harbola, founder of influencer marketing company Buzzoka. Just how much are they spending, we ask. “On a monthly basis their spends could go as high as Rs 15-20 crore,” Harbola reveals, “while a cricket-related sponsorship deal could be as high as Rs 30-40 crore.”
Some of the known celebrities who have promoted cryptocurrencies on Instagram, YouTube, and Twitter include Virender Sehwag, Vir Das, Anupam Kher , Badshah , Harrdy Sindhu, poet Priya Malik, standup comedians Tanmay Bhat, Aishwarya Mohanraj, Bollywood actors Radhika Apte, Kunaal Roy Kapur, and Manoj Bajpayee, YouTube star Ashish Chanchlani, content creators Kusha Kapila and Dolly Singh, Vishnu Kaushal, cricketers Ishant Sharma and Dinesh Karthik.
But brands are aware of the pitfalls of influencer marketing especially in the crypto space.
“We do a lot of influencer marketing to reach out to millennials and youngsters who are tech savvy and get influenced by social media celebrities,” says Sharan Nair, chief business officer, CoinSwitch Kuber. “We also vet all the content that influencers put out apart from ensuring that none of these promotions come across as easy money making schemes.”
Interestingly, most social media promotions by influencers are often short videos and static posts which barely touch upon the topic. However, a set of content creators on YouTube are creating explanatory content around crypto, breaking down the do’s and don'ts for new users. But those are relatively numbered when compared to big bursts of short videos on platforms such as Instagram.
CoinSwitch Kuber’s Nair emphasises that his team spends a lot of time creating explainer content on its own platforms as well as platforms such as Quora.
“We understand that a digital ad or an influencer post might not give a user a full picture of cryptocurrency. Therefore, we invest a lot on creating in-depth content around cryptocurrency in general as well as about our platform,” he shares.
In certain cases, the founders of such exchanges have also become the face of a campaign to bring credibility. A WazirX spokesperson says it is leveraging social media to explain their position to customers. "Our CEO Nishcal Shetty runs a #IndiaWantsCrypto to reach out to lawmakers and to create awareness amongst users. This campaign just completed 1000 days recently," says the company's spokesperson.
Regulatory loopholes & the cryptocurrency advertising conundrum
The multimedia ad blitzkrieg by cryptocurrency platforms are continuing despite a massive regulatory loophole. Currently, the Indian government has not officially recognised cryptocurrency as a financial product therefore it cannot be regulated by bodies such as Securities and Exchange Board of India.
As far as advertising and marketing activities go, no specific guidelines have been put in place for cryptocurrency platforms by ad industry watchdog Advertising Standards Council of India (ASCI) despite its massive presence across media platforms.
Storyboard reached out to ASCI, but the industry body declined to comment on whether it is working on any crypto specific ad guidelines.
Big digital platforms such as Google and Facebook have their own set of guidelines. For instance, advertisers that promote cryptocurrency, cryptocurrency exchanges, cryptocurrency mining software and hardware, and cryptocurrency investment advice need to apply and confirm eligibility from Facebook. Google said that its policy does not allow ads for cryptocurrency exchanges in India.
In July, the Delhi High Court issued notice to the Centre, Securities and Exchange Board of India (Sebi) and others in a plea seeking setting up of guidelines or rules for domestic crypto currency exchanges advertising on televisions. Petitioners sought direction to SEBI to issue guidelines mandating disclaimer text covering 80% of a screen, with a slow voice-over, lasting five seconds, against audio-visual advertisements run by crypto-asset exchanges.
The plea also sought a stop on audio-visual advertisements till the guidelines are issued.
Currently, most crypto exchanges are following self-regulation much like the OTT platforms before their individual guidelines were put in place.
“As we speak, there is no reason for SEBI to regulate crypto exchanges because the industry body hasn’t recognised crypto as a financial product that needs to carry a disclaimer in their ads. In this complete vacuum of regulation, if a crypto exchange wants to advertise its services or products, it can do so with literally no restriction,” says Sajai Singh, partner at law firm J. Sagar Associates.Singh points out that such advertising isn’t wrong in any way, it can only be wrong if the advertising is misleading or false. “That’s the debate that one has to have,” notes Singh, adding that "ASCI can only come in if the ad is misleading or false. Of course, they have put in disclaimers to the extent they can. That’s the conundrum that we are in currently.”