By On the 14 of August 2019, the United Kingdom Advertisement Standards Authority (ASA) published a public complaint against BitMex concerning their advertisement that misled investors.
As seen on the 3 of January 2019 BitMex bought a double-page ad spread in the Times of London to mark the tenth anniversary of the Bitcoin white paper. It used a log chart instead of a linear chart to represent bitcoins fluctuating price in late 2018.
The horizontal axis was divided and demarcated into six months parts depicting dates between January 2009 and January 2019. The vertical axis was marked “bitcoin price in US dollars” split by decimal point value gains from $ 0.0001 to $ 100,000. This graph showed a sudden rise in the value of bitcoins after July 2010. The most significant amount recorded on the depiction was of $ 10,000 between July 2017 and Jan 2018. Written on top of the left page was “The 3 of January 2009”. Ten years ago today “The 3 of January 2019” happened to be denoted on the front page of the times. Text in the bottom right corner of the graph read “Source: Blockchain.com.”
ASA Received Four Complaints Against the Ads
ASA outlines that the ad comprised a double spread of a logarithm graph. The graph depicted the value of Bitcoin against that of the US dollar in the past ten years.
It received four complaints, said ASA. All of them accused the ad of exaggerating the returns of bitcoin or of failing to show the risks involved in the asset.
BitMex, in response, said that the parent firm, HDR Group Trading, studied the ad noting that it made-up part of a campaign to remember the tenth anniversary of the mining of bitcoins block on the 3 of January 2009.
“Thanks, Satoshi, we owe you one. Happy 10th Birthday, Bitcoin,” was written in the footer on the front page of a national newspaper with an accompanying text and a comprehensive article written by Arthur Hayes, CEO BitMex.
Ad Aimed to Inform and Not to Sell
In a decision made public today, the UK advertising agency did not like the chart and has upheld the complaint in the decision. The chart exaggerated bitcoin’s success and failed to illustrate the risks of investing according to the advertising agency.
But BitMex defended itself saying that they neither buy nor sell bitcoins and are only facilitators of crypto financial derivatives to make it easy for peer-to-peer trading. The advertisement has no direct interest in the value of bitcoin itself, and therefore, the ad was intended to inform and not to sell.
The graph was drawn clearly and appropriately labelled said BitMex, intoning:
“The logarithmic scale of the graph significantly understated the scale of the rise in its value which appeared as modest upward growth rather than the approximately 5,200,000% growth from the 18 of August 2010.”
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