Facebook admits guilt and the press confirm how damaging the Crypto Ad Ban really was
The story so far: in January 2018 Facebook decided to ban all cryptocurrency and many related blockchain based businesses from advertising. Google, Twitter and the rest of global tech followed. This lead @apshamilton to start building a legal case that this was an illegal cartel in Australia with global implications and damages. I joined him in bringing this case to court.
You can see previous updates on our case from the account of @jpbliberty here on Hive.
Another So-called Relaxation
But of course, once again, the media are wildly overstating how much Facebook has really relaxed.
The fundamental basis of our claim is that Facebook and Google dramatically harmed the nascent Cryptocurrency and related businesses of Web 3.0 because these threatened their own businesses. In particular we focused on these two because together they dominate global advertising not just online only, but the entire market for advertising.
We've been in court in Australia for over a year refining and explaining our case and it has reached a highly crucial moment where we hope to have a decision very soon.
This is the original policy which kicked off the advertising ban:
Ads must not promote financial products or services that are frequently associated with misleading or deceptive promotional practices such as ... initial coin offerings, or cryptocurrency.
First relaxation
A couple of months later Facebook did make a slight relaxation to allow some large publicly traded companies to advertise: at the time this was almost nobody but might have been a nod at Square.
Second relaxation
In 2019, however, Facebook launched their cryptocurrency play, then called Libra now called Diem. Just before that launch they relaxed their rules just enough so that Libra's own promotional material wouldn't be banned by Facebooks own advertising ban! You can see that in the image to the right.
2021 December Relaxation
Facebook's announcement is here and the full Facebook advertising policy for Cryptocurrency products and services is here. Once again Facebook are trying to devolve responsibility for actually running their own platform onto Governments and regulators. Their main point is to allow services that are registered:
Allowed:
The list of the relevant licenses and registrations that are accepted can be found below. Other licenses and registrations will not be accepted.
Because the hugely profitable Facebook can't make these decisions on their own.
Then we get to the fact that the information presented by Facebook is completely contradictory. From the covering blog post:
Advertisers who were previously approved will not be impacted by this change. The list of products and services that require pre-approval also won’t change. We continue to require prior written permission based on the criteria for:
- Platforms, software apps or products known as cryptocurrency exchanges and trading platforms. Examples include but are not limited to spot trading, margin trading, futures trading or other trading instruments that involve cryptocurrency assets.
- Platforms, software apps or products that offer cryptocurrency lending and borrowing.
- Cryptocurrency wallets that also allow people to buy, sell, swap or stake their cryptocurrency tokens.
- Hardware and software for cryptocurrency mining.
That would seem to allow those items with permission. However the actual policy page:
Policy
Ads may not promote cryptocurrency trading or related products and services without prior written permission. Details on the requirements for permission can be found here.
Not allowed:
- Platforms, software apps or products known as cryptocurrency exchanges and trading platforms. Examples include but are not limited to spot trading, margin trading, futures trading or other trading instruments that involve cryptocurrency assets.
- Platforms, software apps or products that offer cryptocurrency lending and borrowing.
- Cryptocurrency wallets that also allow users to buy, sell, swap or stake their cryptocurrency tokens.
- Hardware and software for cryptocurrency mining.
Allowed with permission:
....
I can't reconcile these two pages. They seem to directly contract each other.
Media Overreaction
But of course the Media are wildly overstating the actual scope of the relaxation, you can see some of the headlines to the right.
FACEBOOK UNBANS BITCOIN ADS IN HUGE BOOST FOR CRYPTO INDUSTRY - The Independent
FACEBOOK RETREATS FROM CRYPTO AD BAN - CNBC
What they do get right is the huge damage the advertising ban has caused and will continue to cause. This is the backbone of our class action in Australia:
- The company’s new policy is huge for the crypto industry and will allow more retail investors to access cryptocurrencies than ever before.
In October, CNBC highlighted the ban’s impact on Bloom, a San Francisco start-up that uses blockchain technology to help people keep control over their personal data online. Bloom had spent hundreds of thousands of dollars on Facebook ads to promote its services, but the saw all of its ads suddenly banned by the social network in October.
“It’s good to see them (hopefully) evolve their stance on new technology that puts users in control of their data,” said Shannon Wu of Bloom in a statement.
The reality
Facebook is still hostile to cryptocurrencies and the entire decentralised technology stack which they KNOW threatens their abusive data rape business model. With countries like El Salvador adopting Bitcoin and many large companies putting Bitcoin on their balance sheets, Facebook can no longer justify their abusive policy completely, but they can't give up on it completely either.
The damage is huge
The advertising ban is still particularly pernicious. At one point during the most recent hearings we had with our #CryptoClassAction case before the court in Australia, the Judge made note of this. The Judge pointed out to us beyond being unable to advertise to people who were directly interested and searching for cryptocurrency related businesses, the advertising ban removed many of the chances for new people to even KNOW about the existence of these products. This is especially acute because Google and Facebook control such large shares of advertising space on 3rd party websites, not just their own.
News soon
We hope to have news from the court in Australia soon. You'll hear about it first here on Hive of course on my account, @apshamilton and @jpbliberty.
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We look forward to hearing from you in the Australian court. I hope to hear good news.
What can I say? The impact of the ban was huge, infact advertising on Facebook became really suspicious for a lot of people I knew, once they saw that theit business built on Facebook is money related, there's a suceptibility that they'll get crypto ads on their pages, but then it limited the intake of many page owners in Nigeria being that Crypto is become a huge source of revenue to people even if it's somewhat banned.
Anyways, Libra isn't crypto, it's just like Nigeria pushing e-naira (their own version of Crypto) simply because they cannot lift the ban on Crypto and people are clamouring for crypto. I actually feel these relaxed policies on the Facebook ban is still a ban.
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Good one here
Thanks for such a detailed post.
I was telling someone just the other day about the lawsuit and now I can send them here to read up on it.
Keep up the good fight!
Wow we all hope for a possible outcome at the end of the whole scenario
The ban shows how much they fear web3.
You are getting ads for sites that eventually leads to porn and gamblings, and with that they are more than ok. But crypto is an alternative and they deliberately suspended the progress of the industry.
So true!
That's pretty big news. Now we just need to find all the banks saying publicly how bad crypto is as they manipulate the markets.
Smashing it, gents. Keep up the fantastic work.
Just demonstrates the need for alternative platforms where users themselves get to choose what they want or don't want to expose themselves to, rather than top down decisions.
Don't get me wrong, I hate Facebook as much as anybody, happily deleted my account a year ago. However imo they are a company free to make rules for advertisement on their platform as they see fit.
Should they be allowed to use any amount of money or political influence to crush new ideas and potentially competetive tech or ideas?
On their own platform? Yes, absolutely. They should be forced to some level of transparency so that people can see their behavior and decide for themselves if they are fine with supporting this platform and their policies.
I don't like the argument that FB is so big that things like freedom of speech ought to be implemented. If you want civil liberties on a platform it needs to be created and supervised by the state. I know suggesting that social media would be better if it is state-owned is quite the foolish believe, but I think it is an option worth exploring.
As a company in a free market FB can kick me out for saying something they don't like, like any Barkeeper can kick me out of his bar.
However it happened, Facebook and Google together have functional monopolies in two main types of advertising. Do we just have to accept that they can do anything to protect that monopoly now they have it including forming a cartel?
Well we have a "ministry of cartels" (Kartellamt) and other laws that are supposed to prevent monopolies from forming. This never worked though.
Monopolies and Companies pretty much having the power of a state including their own laws, culture, etc. is one of the reasons I have been a socialist for a long time. However I think regulating companies with tight-nit laws, only for the big ones to maneuver through it without actually abiding by the law and small firms suffering because of all the legal hurdles.
Like I said, I think the solution has to be either the free market where facebook just gets replaced by a better competitor (like hive xD) or there needs be a state-sponsored and controlled social media, where freedom of speech is upheld and every citizen has a right to participate. The state controlled social media being in a fair competition with multiple other social media platforms would be my favorite outcome.
Still I wish you good luck with your endeavor even if I would chose a different path.
Yours is such a common response but it wrongly attributes basic rights to companies that simply don't exist.
Companies are not people and don't have ANY fundamental rights. They are completely creatures of statute.
People DO have fundamental rights (though many governments seem to ignore them at the moment), but when people use infrastructure created by the State they also have to follow rules.
Its like saying I'm free to drive on the road any way I see fit, even if it kills people.
As companies ARE infrastructure created by the State they are completely rule bound.
One rule they have to follow is not to make illegal cartel agreements with competitors.
Another is not to engage in anti-competitive activity.
As advertising is essential to the very essence of competition (discovery of market information) blocking a whole industry from its main modes of advertising is fundamentally anti-competitive.
well, to be fair my mom would understand a whole lot more about crypto if it was permitted on FB.
But to your points, well I might revisit my own the Barkeeper. He is a person and represents the company "the Bar" at the same time. However it would be illegal to not serve a customer based on their believes, religion (or skin color caugh). So I guess you are kind of right, it is discriminating against crypto (their users and companies included)
I just don't like hiding behind an anti-discrimination law when I would propagate that in the perfect world people (and companies) are free to choose if they want to discriminate, it just backfires so hard that people are not discriminating. In reality many seem to chose apartheid even in a world that claims to be past that.
Ok now finally back to your points, I disagree that companies are infrastructure besides actual state-owned companies. Companies are something that rose to prominence despite the state/the monarchy but they had to cut a lot of deals with the state leaving the common man poor and broken.
The more I think about it the more I think there should be no difference in what a person can do to what a company can do. After all Bill Gates just privately owns 269,000 acres of farmland, why should he be able to do more with this land than any company? Couldn't companies disguise their doings as that of a single person?
I know in reality there a lot of additional laws companies have to abide by, see the cut deals with the Monarchy thing, but I like to sometimes take the market extremist standpoint while I know that monopolies are inevitable. Have you ever heard about accelerationism?