Numerous Sports and Esports companies are cutting ties with the crypto exchange.
•Mercedes-AMG Petronas, Miami Heat, Golden State Warriors, Team SoloMid, UC Berkeley, Major League Baseball’s umpires, and the Washington Wizards/Capitals have all suspended their deals with FTX in light of the company’s bankruptcy filing.
• Athlete endorsements from Tom Brady, Steph Curry, Naomi Osaka, and Shohei Ohtani have also been called into question.
It’s been a tough week for FTX. The cryptocurrency derivatives exchange filed for bankruptcy on Monday, and since then, a number of big names have cut ties with the company. Mercedes-Benz, the Miami Heat, the Golden State Warriors, Team SoloMid, UC Berkeley, and Major League Baseball’s umpires have all suspended their deals with FTX in light of the bankruptcy filing. Athlete endorsements from Tom Brady, Steph Curry, Naomi Osaka, and Shohei Ohtani have also been called into question.
According to FTX’s bankruptcy filing, the company owes $2.5 billion to creditors. This debt is spread out among a wide variety of parties, including Mercedes-Benz ($100 million), the Miami Heat ($470 million), the Golden State Warriors ($1 billion), Team SoloMid ($8 million), UC Berkeley ($1.5 million), and MLB’s umpires ($10 million).
While it’s unclear if any of these organizations will actually pursue legal action against FTX, it’s clear that they are not happy with how things have played out. This could very well be the beginning of the end for FTX as a viable business.
FTX. was able to gain major sports and esports partners which have recently ended their deals with the company in an attempt to get out from under the wave of turmoil associated with the company.
Mercedes AMG Petronas: The F1 racing team made the announcement on Nov.11 that they had dissolved their partnership with FTX and removed the branding from their cars. The original deal between the two companies was a long-term one. There were some F1 themed NFTs sold as well that collectors now have no access to.
The FTFuria: a Brazillian esports team said it would discontinue its FTX sponsorship. The deal was small and only valued at $3.2 million. The team stated they prioritized fans over everything. Another Esports team Team SoloMid had the largest deal at $210 million across 10 years. The team was called TSM FTX but has currently cut ties with the company as well and will remove all FTX branding from jerseys, social media, and more.
The Golden State Warriors removed themselves from anything FTX on November 14 and stated they would stop promoting or advertising for the exchange. The multi-year deal was announced in December 2021 and was worth $10 million reportedly. The Miami heat is working to immediately change the name of the FTX arena where they play. The deal was a 19-year $135 million deal that was announced in 2021.
What Happened?
Simply put, business done at FTX was conducted on the backbone of a spurious token and a bunch of falsehoods. The now ex-CEO Sam Bankman-Fried used the lie of “effective altruism” to build positive feedback and get most of the investors to believe he was more of a genius than he truly was. There was perhaps a level of genius involved in the scam but in the end SBF was bested by Changpeng Zhao CEO of Binance.
FTX filed for Chapter 11 bankruptcy on Monday after accumulating $2.5 billion in debt. The filing lists a number of creditors, including Mercedes-Benz ($100 million), the Miami Heat ($470 million), the Golden State Warriors ($1 billion), Team SoloMid ($8 million), UC Berkeley ($1.5 million), and MLB’s umpires ($10 million). It’s unclear exactly how or why FTX accumulated so much debt, but what is clear is that many of the company’s creditors are not happy about it. In the wake of the bankruptcy filing.
It remains to be seen what will happen to FTX in the wake of these suspensions and calls for action from some of its biggest creditors. However, one thing is certain — this is not a good look for a company that only recently made its debut on Nasdaq. It’s possible that this could be the beginning of the end for FTX as a viable business. Only time will tell.
Time will tell whether or not FTX will be able to rebound from this setback. In the meantime, it seems like many of the company’s biggest partners are cutting ties or at least distancing themselves from FTX in light of its bankruptcy filing. This could very well be the beginning of the end for FTX as we know it — only time will tell where things go from here.
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