Spain’s National Stock Market Commission (CNMV) has threatened to prosecute billionaire Elon Musk’s social network X, also known as Twitter, for advertising unlicensed cryptocurrency companies.

CNMV President Rodrigo Valbuena said that the regulator has discovered many tweets from crypto companies whose advertising materials do not comply with current laws on the promotion of cryptocurrencies. Under Spanish law, social networks and other service providers are required to verify that the products advertised are provided by registered financial service providers with a valid license or not.

Valbuena assures that many materials advertising crypto-assets illegally use photographs of Spanish actors, and also imitate websites and logos of state media. This is done in order to gain the trust of potential investors and secure investments.

Stock market regulations in Spain mean that Internet service providers and social networks are required to take measures against the distribution of advertising from unlicensed organizations. Check whether the client companies with which the advertising contract is concluded are included in the CNMV “black list” and whether they actually have the right to provide financial services.

CMNV may impose sanctions on X for non-compliance with the rules. The agency is ready to use its powers to punish those responsible, Valbuena promised. The official criticized social networks for greed, emphasizing that they should not accept a single euro as reward for advertising by companies that want to make a profit by deceiving users.

In 2022, the CNMV introduced rules for advertising campaigns for cryptocurrency firms. Since then, the CNMV has reviewed 1,327 advertisements, found 210 offenders, issued 196 information requests and sanctioned one cryptocurrency campaign. The CNMV recommended that investors take into account the volatility of the cryptocurrency market and urged them to avoid investing in digital assets altogether.