Top Crypto Companies cancel sponsorship deals amid Bear Market
Dozens of crypto companies have been forced to pull out of massive partnership deals amid the recent market downturn.
New York Post reveals that cryptocurrency companies are cutting costs by pulling out of sponsorship and marketing deals as the crypto market crashed to its lowest in almost two years.
FTX, one of the largest crypto exchanges, had signed billions of dollars’ worth of deals in the recent past with the NBA, the MLB, and several other sporting leagues only to back out of them in light of the recent crypto crash.
The crypto exchange announced they have since withdrawn from talks to offer a jersey patch to the Major League Baseball’s (MLB) Los Angeles Angels.
The expenditure downturn comes after the crypto exchange had splurged on sponsorship deals in recent months near all-time highs in an attempt to entice sports fans, many of whom were flush with cash in a tight job market following hefty government assistance from the pandemic.
FTX had paid $135 million to rename the Miami Heat’s home stadium after itself in March 2021.
The top crypto exchange also paid an unknown amount to become the MLB’s “official cryptocurrency exchange.”
In addition, the exchange spent over $20 million on a commercial featuring Tom Brady, the famed sportsman, and his supermodel wife, Gisele Bündchen. They paid $6.5 million for a Super Bowl advertisement starring Larry David, in addition to many other sponsorships.
Unlike several other crypto exchanges like Crypto.com, Coinbase, Rain Financial, BitMex and others, FTX has not yet made any layoffs as a result of the present slump. They rather are trying to cut costs via different means.
In a tweet sent immediately after Coinbase and Crypto.com announced layoffs, Changpeng Zhao, the CEO of Binance, the world’s largest cryptocurrency exchange in terms of trading volumes, appeared to poke fun at his competitors for spending much on sports deals.
He hinted that by avoiding such frivolous spending, the exchange is still retaining its employees and hiring new people as well.