The ongoing winter market results in lower investment on cryptocurrency advertising, which caused a loss in revenue for Alphabet, the parent company of Google. The company’s advertising-related income was at its lowest in the past ten years. It can be seen as another downturn in the digital asset industry brought by the year-long bear market.
While Google’s advertising income increased to $54.4 billion from $53.1 billion, YouTube ads revenue decreased from $7.20 billion to $7.07 billion, as stated in the third-quarter financial figures, released on October 25, 2022. Revenue ad rate dropped to 6% from 41% in 2021, the lowest level since 2013 as per CNBC.
Google reports drop in revenue due to crypto winter
Google sales chief Philipp Schindler has stated, “In the third quarter, we did see a pullback in spend by some advertisers in certain areas in search. For example in financial services, we saw a pullback in the insurance, loan, mortgage, and crypto subcategories.”
In addition to the bear market, regulator pressure might be the reason for the drop in crypto advertising. The regulations restricting cryptocurrency promotional campaigns have been implemented by governments from the UK to Singapore. Such an effort was in the news when companies have recently been unable to show their brand logos on the racetrack in Singapore and France in a race event like Formula 1.
In countries like the United States and India, crypto influencers have also been the focus of media attention as influencers were responsible for more than 90% of the deceptive cryptocurrency advertisements that were posted online. Authorities in India are investigating cryptocurrency advertisements posted by local social media stars.
Although Google is facing the downfall in the advertising sector, the company has continuously enhancing its cloud services as it partnered with leading cryptocurrency exchange Coinbase to allow cryptocurrency payments. Moreover, it has also joined hands with BNB projects in order to support web3 startups as TheCoinRise reported.