Cryptocurrency exchanges target sport sponsorships

For more than a quarter of a century, the Italian tire maker Pirelli logo has graced the shirts of Serie A football champion Inter Milan. But this season, Inter’s black and blue striped tops are encrypted.

With the proliferation of cryptocurrencies and blockchain technology, the companies behind the early industry are increasingly looking to sports sponsorship to accelerate their decade-long journey from the depths of the Internet to mainstream speculative assets. I’m aiming.

European football clubs are moving in a direction that cannot be overlooked Revenue of 9 billion euros According to the governing body, Uefa, the pandemic struck a balance sheet with disrupted broadcast schedules and fanless games at the stadium. As Britain is reviewing gambling legislation, some football executives have warned that rulemakers could hurt profits if they crack down on Italy and Spain. Bet sponsorship..

Cryptographic companies that benefit from the rising value of Bitcoin and other digital currencies are willing to close the gap. Inter Milan shirts will now promote crypto exchange Socios.com in private monetary transactions. Sports and cryptocurrency executives say such sponsorships are on the rise and are worth 7-8 digits a year.

“I don’t think it’s opportunistic, [crypto has] Pandemic, sports knelt down and really went well [and] Benpincus, director of the commercial partnership for Formula 1 in the global racing series, said:

In June, F1 added Crypto.com, a digital wallet for storage and payment in digital currencies, to its sponsor list, including Swiss luxury watchmakers Rolex, Pirelli and oil company Saudi Aramco. .. The deal is worth as much as $ 30 million a year, according to someone close to F1.

However, there are doubts about what a sustainable crypto transaction will look like over the years of the agreement. For example, some exchanges are growing rapidly before losing to new competitors or succumbing to theft or other cybersecurity failures.

Inter Milan is one of a series of teams, including domestic rivals AC Milan and Juventus, Spain’s FC Barcelona, ​​England’s Arsenal and Manchester City, where clubs and leagues trade like fans and other assets. it was done.

Socios, which is part of a group of registered entities in Malta and Switzerland, does not sponsor the shirts of all clubs affiliated for the sale of tokens.

Tokens also provide supporters with access to promotions and rewards. Juventus has used this platform to allow token holders to select songs to play when the team scores.

Fans will need to use Chiliz, Socios’ own digital currency, to purchase team tokens through the company’s app. According to Coinmarketcap.com, Chiliz is trading at just over $ 0.31 per coin, reaching $ 0.84 in April this year, indicating that fans are caught up in the volatile crypto market.

In May, the tokens of the Spanish club Atletico Madrid surged to over $ 50, similar to winning the LaLiga title, with 24-hour trading volumes exceeding $ 300 million. It fell to one-fifth of that within a few weeks.

Alexandre Dreyfus, founder of Socios and Chiliz, said that clubs and leagues need to be very careful about who they partner with. “They intend to give some legitimacy. [these] “Brand,” he said. He added that the club needs to make sure that crypto companies bring “regulatory certainty” and provide fans with a “safe environment.”

Regulators are stepping up cryptographic scrutiny. The UK Advertising Standards Authority has warned that misleading crypto-related ads will be “severe and swiftly cracked down” while financial regulators are increasing sector oversight.

Still, cryptocurrency sponsorship continues in the United States. In June, Major League Baseball signed a long-term multi-million dollar deal with the exchange FTX last month. Equivalent to $ 18 billion, Up from $ 1.2 billion last year.

“The pandemic has accelerated so many different consumer trends, whether or not it was my parents that I didn’t expect to understand how to access Netflix. Whether it’s people investing in crypto space, “said Noah Gardens, MLB’s Chief Revenue Officer. “I think it stays here.”

Sina Nader, Chief Operating Officer of FTXUS, said the next challenge was to get them involved in the dialogue as people became more familiar with cryptography as a concept. “And sports actually capture the imagination of literally billions of people. We aim to reach those billions of people,” he said. “Is it opportunistic? I don’t think so. It happened that the timing was right.”

The exchange employs Tampa Bay Buccaneers quarterback Tom Brady and his supermodel wife Gisele Bundchen as ambassadors and advisors, spending tens of millions of dollars annually on sports sponsorship.

Cryptocurrency companies are confident that partnering with the biggest name in the sports world will make them more appealing to mainstream viewers in the digital economy. And they are willing to pay first.

In July, StormX paid “8 digits” for a five-year jersey sponsorship of the US basketball team Portland Trail Blazers. Simon Yu, CEO of a company that works with leading retailers to reward shoppers with crypto tokens, is an NBA viewer and StormX’s target audience, “mainly male” customers aged 18-45. He said there was a “very strong correlation” between them. ..

“Most of the people we’re trying to attack in the NBA aren’t interested in cryptocurrencies yet,” he said.