After the catastrophic fall of FTX, several companies that had their brands attached to the exchange are now planning on how to move on.
The shamed crypto-exchange had several multi-million dollar sponsorships deals with some of America’s most iconic sports teams.
After the exchange declared bankruptcy, the new CEO, John Ray III, will have to sort out the finances of his company in order to pay for these millionaire contracts with sports clubs.
Miami Heat Gets Rid of “FTX Arena”
The Miami Heat joined by Miami-Dade County declared this Friday that their partnership with FTX is now over. The exchange used to own the naming rights for the basketball team’s arena.
The statement came after the exchange filed for bankruptcy in the United States this week. Also, the former-billionaire Sam Bankman-Fried resigned from his position as CEO.
What’s important to note, is that the FTX Arena deal did not last nearly as much as expected.
In June of 2021, Sam Bankman-Fried announced the exchange acquired the rights for the arena – making it the “FTX Arena” – in a deal that supposedly should last 19 years.
At the time, the exchange invested $135 million to obtain the FTX Arena rights. The deal provided the Heat $2 million each year, with the county receiving around $90 million over the course of the contract.
Other Sports Affected By The Exchange’s Collapse
Another NBA team also found itself in the middle of turmoil due to the FTX scandal.
Golden State Warriors, one of the most traditional basketball clubs had a long and lucrative sponsorship with Sam Bankman-Fried’s cryptocurrency exchange.
After the turmoil, the multiple-time NBA champion from San Francisco announced that it will be pausing any promotions related to FTX.
The exchange is also the official Major League Baseball sponsor. At the time, the sponsorship deal was regarded as a huge win for crypto – due to FTX being the first-ever cryptocurrency-related sponsor in the MLB. On top of that, FTX.US was in charge of the baseball organization’s commercial rights.
MLB directors declared that they will be consulting with lawyers in order to decide what will be the next move in order to sort out any financial issues following FTX’s bankruptcy.
Along with the Chapter 11 bankruptcy filing, the firm announced that CEO Sam Bankman-Fried will no longer serve as CEO, but instead continue to help the newly-appointed John Ray III in the transition.
With FTX declaring bankruptcy, their sponsorship arrangements with MLB and the other sports they signed to are now in jeopardy.
Many of the workers are likely to stay with the FTX Group and assist Ray and independent specialists with the company’s operations during the Chapter 11 procedures – which will include sorting out the payments for sponsorship deals with sports companies and organizations.