The CNMV initiates the first sanctioning case in Spain for infringement in the advertising of cryptoassets

The National Securities Market Commission (CNMV) has opened a sanctioning case against the company Miolo Developments for possible serious violations that occurred while carrying out cryptoasset advertising campaigns. This is the first sanctioning case opened in Spain for this reason after the publication of the Circular on advertising of cryptoassets presented as an investment object, issued by the CNMV, published on January 17, 2022 and which came into force in February of that same year.

More specifically, the case was initiated for the alleged commission of violations during the carrying out of two massive advertising campaigns in September and November 2022 by the company Miolo Desarrollos.

The sanctioning file identifies the following two serious violations defined in article 292.4 of the Securities Market Act for non-compliance with administrative control measures for the advertising of cryptoassets, consisting of:

- Not having incorporated any information or warning about the risks associated with operations and investments in cryptoassets (Rule 5 of Circular 1/2022)

- Not having made the mandatory prior communication to the CNMV for mass advertising campaigns (Rule 7 of Circular 1/2022)

As we have mentioned before, this is the first sanctioning file opened in relation to non-compliance with the provisions of Circular 1/2022 and the CNMV wanted to take the opportunity to make an appeal to highlight the importance and need to follow the precepts cited in said Circular.

This Circular is limited to regulating the advertising activity of cryptoassets and is applicable to all companies, whether they are providers of cryptoasset services or not, that carry out any advertising activity regarding transactions and/or investment activities with cryptoassets. The body responsible for oversight is the CNMV, a body that also has the power to sanction.

The purpose of this Circular is to protect consumers in the face of such a volatile and risky market as that of cryptoassets.

For this purpose, companies are required to include warnings and report risks associated with operations in all advertising messages and to make prior communication to the CNMV with general information about the campaign and specific information about the advertising pieces in question.

Finally, with regard to the sanctioning file opened against Miolo Desarrollos, the CNMV declares that the announcement of the opening of the file took place once the company has been notified and that in no case does it prejudge the final outcome of the sanctioning file, with the company at its disposal all the means offered by the legal system for the defense of its rights.