Twitter will crack down to protect users from scams using its social media platform.
Following in the footsteps of the two other social web behemoths, Google and Facebook – and following a week of rumours – Twitter has now confirmed that it will ban adverts for Initial Coin Offerings and certain other cryptocurrency services in order to protect its users from scams. The ban will apply globally across the Twitter platform from today, according to reports, with exchanges and wallet services exempt from the measure “if they are listed publicly on ‘certain major stock markets’”, according to the Financial Times.
Bitcoin (BTC) was down around 8% following the news, according to Coincompare, dipping back below the $8,000 dollar mark after a brief spike overnight (UK) had sent it up over the $8,100 mark. Generally, though, its price appears to be following the slow downward trend we’ve seen all week. Other cryptos – including Ethereum (ETH), LiteCoin (LTC) and Monero (XMR) have all taken 10%-plus hits, with notable dips after the news broke Monday afternoon US time.
This reaction possibly goes to show the effect such news has on the nerve of participants in such volatile markets, as much as it does on the effect Twitter’s ban will actually have on those currencies. After all, its measures are designed to back up steps it has already been taking to stop spoofing and scam accounts, which have been used to falsely inflate prices in so called ‘pump-and-dump‘ operations. Such ruses have seen notable exchanges, and certain personalities from the crypto world like Binance’s Changpen Zhao and Ethereum founder Vitalik Buterin, impersonated on the service.
Obviously, an ICO ban is a step well beyond shutting down fake accounts, and there is irony to be found in the fact that the move comes not long after Twitter CEO, Jack Dorsey, offered a ringing personal endorsement of Bitcoin, saying he believes it will become a “single currency” for the world. However, it’s easy to see how the somewhat draconian measure could – notwithstanding a short-term dip in confidence in Bitcoin et al reflected by a falling price – leave the market stronger in the long run, making the two stances somewhat mutually compatible.
If nothing else, it means that investors won’t get swept up in get-rich-quick schemes so easily, and will have to do a little bit more legwork before investing. No bad thing, we suspect.