Crypto Marketing in Canada: What You Can and Cannot Say

I saw an ad saying there’s no risk in trading bitcoin. How can they say that?
—Abbas

That’s an important question. Cryptocurrency firms often use bold, flashy marketing to attract new customers. Some promotions promise unusually high returns or imply little to no risk, which can be misleading. It’s essential to separate legitimate, regulated operators from misleading promotions or outright scams.

Recent events illustrate the danger. In late 2022, the collapse of Alameda Research and its affiliate FTX—once among the largest cryptocurrency trading platforms—highlighted how marketing claims can be disconnected from reality. Earlier reporting also showed that, in some cases, companies have promoted high returns with phrases such as “no risk” or “no downside.” Other high-profile cases, like BitConnect, similarly promoted implausible returns and were later revealed to be fraudulent schemes. These examples show why skepticism and due diligence are critical when evaluating crypto offers.

It’s equally important to understand that regulators in some jurisdictions have issued guidance about how crypto trading platforms should market themselves. In Canada, for example, securities regulators and industry oversight bodies have set expectations for advertising and disclosure by platforms offering trading in crypto assets. That guidance generally requires firms to avoid unsubstantiated claims, avoid suggesting guaranteed returns, and avoid marketing that resembles gambling or that might encourage excessive risk-taking.

So how do you tell if a crypto ad or promotion is legitimate? Below are practical, easy-to-follow steps and red flags to watch for when you see marketing for crypto services.

How to spot misleading crypto advertising

• Unrealistic returns: Any claim of guaranteed or exceptionally high returns with little or no risk is a major red flag. Legitimate investments carry risk; no reputable provider can promise risk-free profits.
• Pressure tactics: Be wary of time-limited offers, countdowns, or messages that push you to act immediately. Urgency is a common tactic to prevent people from researching properly.
• Overemphasis on staking for returns: If a platform tells you to stake or lock up more coins to receive dramatically higher rewards, pause and investigate. High staking offers can hide liquidity issues or Ponzi-like structures.
• Lack of verifiable credentials: Check whether the company is registered with relevant financial regulators in your jurisdiction. Registration and oversight are strong indicators of legitimacy.
• Opaque team or company information: Reliable companies disclose who runs the business, where they operate, and how they handle custody and security. Anonymous teams or limited transparency are warning signs.

When an ad looks suspicious, take the time to verify independent information before depositing funds. Here are concrete steps you can take to vet a platform:

Practical steps to verify a crypto platform

• Confirm regulatory status: Look for registration or licensing details with your local securities or financial regulator. Registered firms typically provide contact details and formal disclosures.
• Read the terms and disclosures: Review the platform’s terms of service, fee schedule, and risk disclosures. Legitimate platforms clearly explain fees, custody arrangements, and withdrawal policies.
• Assess security practices: Check whether the platform uses strong security measures such as two-factor authentication (2FA), cold storage for most customer assets, and transparent audit statements.
• Search for independent reviews and news: Look for reputable coverage or community discussion about the platform. Multiple independent sources can help confirm whether the company is trustworthy.
• Test with small amounts: If you decide to try a new platform, start with a small deposit you can afford to lose. Verify the deposit, trading functionality, and ability to withdraw before increasing exposure.
• Be cautious of incentives: Welcome bonuses or deposit matches can be legitimate, but read the fine print. Some promotions impose strict conditions that make it difficult to withdraw earned rewards.

Beyond company checks, keep a few general investing rules in mind:

• If it sounds too good to be true, it probably is.
• There is always risk in crypto; volatility and technical risks exist even with reputable platforms.
• Never invest more than you can afford to lose.

Jeremy Koven is identified in the original context as a co-founder and executive of a Canadian cryptocurrency trading platform. When evaluating sponsored content or advice, remember the source and whether the piece includes promotions linked to a specific provider.

In summary, marketing can be persuasive, but you should base financial decisions on facts, verification, and an awareness of risk. Use regulatory checks, clear security indicators, independent reviews, and conservative testing with small amounts to protect yourself. If anything about a promotion or platform feels off, pause and investigate before committing funds.

Further reading and topics to explore

• How to evaluate cryptocurrency platforms and apps
• Common crypto scams and how to avoid them
• Ways to protect your crypto from hacks and theft
• Questions to ask about a crypto platform’s custody and security practices