TikTok, one of the most viral video apps in the world, has banned the paid promotion of crypto and forex-related products by the users on its platform as the latest social media storm created by Gamestop and meme stocks seems to have given it the jitters.
The video app has more than a billion users and has spread far and wide despite the recent competition from Instagram and YouTube and over the last few months, we have been seeing thousands of users promoting various crypto products including tokens. Though the company has banned only paid promotions, it basically means that the users can continue to give their views and opinions about various crypto and forex products.
Of late, we have been seeing many users and influencers who have thousands of followers trying to talk up or down various financial services and products, both on a personal basis and also as part of paid promotion. Though most of these users do not have any history of having any work experience or knowledge of the financial industry, they do promote such products and this has been considered a dangerous trend as it directly affects the financial well-being of their followers.
This disturbing trend has led many users to invest in coins, tokens, and products and they have also been led to losing a lot of funds from their accounts due to the wrong financial advice and volatility as well. Financial products always involve risk which is the reason why it is tightly regulated and controlled by various authorities all around the world. But TikTok is a very cheap and easy way for influencers to reach out to their followers and give out financial advice with no oversight or regulation.
Though the reasons behind this action by TikTok are not known, this could be very useful in the long term and could set a path for others to follow too. It is important that other similar social media platforms also take a pledge to ensure that no such products or advice is given out by unauthorized or unregulated users or entities so that thousands of gullible investors are saved from influencers who give out the advice purely for promotions.
We will have to wait and see whether other platforms follow the lead set by TikTok and clean up their act in the coming months.