YouTube has always been fighting against disinformation, misleading content and outright scams on its site. Despite the lawsuits and Google's advertising policies, scam ads using cryptocurrencies continue to circulate.
In April, Ripple CEO Brad Garlinghouse filed a lawsuit against YouTube claiming that the company's inaction against fraudulent content on its platform damaged Ripple's reputation due to XRP's "giveaway" scams - here quotation in real time.
Garlinghouse is not alone. Apple co-founder Steve Wozniak is suing YouTube and its respective parent company Google on charges of "allowing bitcoin giveaway scams that exploit similarities [to his face] to thrive on the platform." Despite this, advertisements that hide scams are still around.
Any content is a vehicle for growth
In the early days of YouTube, there was a ton of pirated content driving its growth, said Adam Helfgott, CEO of programmatic advertising company MadHive. “What is happening now is somewhat analogous to that situation,” Helfgott said.
In July, YouTube decided to dismiss the Ripple lawsuit, relying on the Section 230 articles, which protect companies from content liability. "YouTube's motion to dismiss the allegations boils down to the idea that the video-sharing giant has not voluntarily or knowingly engaged in any of the scams or copyright infringement and cannot be held responsible for any third-party content on the his website ".
Additionally, "The company's motion also adds that it has closed such scams whenever it was warned." The part that is still an open question is how much money YouTube - and its parent company - make from scam ads and how effective the mechanisms are in place to remove them.
The advertising ecosystem
Google has policies governing the types of ads that can be served on its platforms, including YouTube. Under these policies, advertisers are not allowed to run ads, content or links that attempt to deceive or circumvent ad review processes, according to Google.
Due to the complex and evolving nature of cryptocurrencies and their related products and services, Google only allows a limited set of ads for regulated exchanges in the US and Japan.
However, the scam announcements persist. In 2019, Google removed about 2,7 billion malicious ads. This means that it removed around ten million ads a day. Sure, companies could do a better job.
However, companies that rely on large-scale advertising, such as Youtube and Facebook, don't necessarily have an incentive to do so. For every rule that YouTube implements on advertising, the number of ads may decrease and this is not in Google's interest. It's a complicated game of whac-a-mole that has no end yet, despite the pending lawsuits.
