BMO Identifies Age Verification Rules as an Emerging Regulatory Risk for Meta

BMO Capital Markets said the expansion of age verification requirements worldwide could create additional regulatory challenges for social media companies, identifying Meta Platforms (NASDAQ:META) and TikTok as particularly exposed.

The bank said the regulatory framework remains at an early stage following Australia’s introduction of online age verification rules in December 2025. Other countries have subsequently introduced measures restricting minors’ access to online content.

According to BMO, social media platforms face greater exposure because many of the measures focus on restricting access for users under the age of 16.

Meta Settlement Includes Financial Penalties and Operational Changes

BMO highlighted Meta’s settlement with 52 US state attorneys general over child safety concerns.

Under the reported agreement, Meta accepted financial penalties of up to $18 billion and structural changes, including a two-hour daily time limit for users.

The bank considers the operational requirements more consequential for Meta’s business than the financial penalties because they could affect how users interact with its platforms.

BMO also suggested that the settlement could encourage US lawmakers to consider further restrictions on social media use by minors.

These potential legislative developments remain uncertain and would depend on subsequent regulatory and political decisions.

BMO Differentiates Exposure Across Internet Companies

BMO identified Meta and TikTok as facing the greatest exposure to age verification initiatives among the internet companies it examined.

The bank placed YouTube, owned by Alphabet (NASDAQ:GOOGL), alongside Roblox (NYSE:RBLX), Snap (NYSE:SNAP), Pinterest (NYSE:PINS) and Reddit (NYSE:RDDT), in a separate category of moderate exposure.

Netflix (NASDAQ:NFLX) was identified as having comparatively limited exposure to the requirements.

These classifications represent BMO’s assessment of potential regulatory effects rather than confirmed financial outcomes for the companies.

Verification Technology Continues to Develop

BMO said age verification technology has improved, with available methods including photographic identification and facial age estimation using selfies.

However, the bank noted that users can still circumvent these systems, complicating enforcement.

It identified token-based verification and zero-knowledge proof technology as approaches that could provide more secure ways to manage age-related information while supporting regulatory compliance.

Zero-knowledge proofs can allow a user to demonstrate that an age requirement has been met without disclosing the underlying personal information.

BMO also suggested that AgeKey could emerge as an industry standard for verification technology, although widespread adoption has not been established.

The bank’s analysis indicates that the effects of age verification requirements will depend on how regulations develop, how platforms implement compliance measures and whether verification technologies can be applied effectively.

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