Three years after the first joint press statement of the Spanish Securities and Exchange Commission (hereinafter “CNMV”, in its Spanish acronym) and the Bank of Spain about cryptocurrencies¹, on February 9, 2021, both supervisors issued a new press statement on cryptocurrency investment risks². The reason for the new joint statement is the high price volatility that numerous cryptocurrencies had recently experienced, together with a significant increase in advertising of these assets. Consequently, the CNMV and the Bank of Spain highlighted that, from a legal standpoint, cryptocurrencies are neither a means of payment, nor are backed by a central bank or any other public authority, and are not covered by customer protection mechanisms.

Just one month later, on March 12, 2021, the Spanish government approved the Royal Decree-Law 5/2021, on extraordinary measures to support business solvency in response to the COVID-19 pandemic³. The aforementioned Royal Decree-Law includes in its second final provision a new article 240 bis of the Securities Market Act, which grants the CNMV competencies in order to subject to administrative control the advertising of crypto-assets and other assets and instruments that are not regulated in the Securities Market Act and which are offered as an investment proposal. Concretely, new article 240 bis of the Securities Market Act establishes:

“The CNMV may subject to authorization or other forms of administrative control, including the introduction of warnings on risks and characteristics, the advertising of crypto-assets or other assets and instruments presented as investment objects, with comparable advertising dissemination, even if they are not activities or products provided for in this Law. The CNMV will develop by means of a circular, among other matters, the subjective and objective scope and the specific control modalities to which such advertising activities will be subject.

For these purposes, the provisions of the second paragraph of Article 240 of this Law shall apply.”

For clarification, it should be remembered that article 240 of the Securities Market Act expressly authorizes the CNMV to exercise any appropriate actions in order to obtain the cessation or rectification of advertising that is contrary to the provisions established by the CNMV or that in general must be considered unlawful, without prejudice to the applicable penalties.

In this regard, Royal Decree-Law 5/2021 also modifies article 292 of the Securities Market Act, on infringements for failure to comply with the obligations required for the proper functioning of the primary securities market and the trading of financial instruments in secondary securities markets. Thus, the modification also includes as an infringement the activity of advertising in violation of articles 240 and 240 bis, or their implementing regulations.

Finally, after this important modification of the Securities Market Act, it remains to be seen whether the CNMV will also amend its recently approved Circular 2/2020, of October 28, on the advertising of investment products and services which, if necessary, will be subject of a new legal flash.

1. https://www.bde.es/ ↩
2. https://www.cnmv.es/ ↩
3. https://www.boe.es/ ↩