Has the naming rights curse finally hit crypto?

While it would be unfair to say that every corporate stadium naming rights association precedes an unfortunate event — after all, there are more than 75 professional league stadiums in America — a mythology has been established around such deals and the arrogance what is needed to carry them out. .

Even if talk of a naming rights curse is a bit of an exaggeration, it has to be said that some of the most high-profile naming deals in recent years have focused on particularly disastrous episodes. Think of MCI Center in DC, Enron Field in Houston, and Wachovia Center in Philadelphia.

If nothing else, these deals can apparently provide a handy litmus test ahead of major market downturns.

story rhyme

On April 7, 2000, exactly one year prior to As journalists and investors began to question its financial statements, Enron bought 30 years of naming rights to the newly built Astros stadium in Houston. The price of the rights was $100 million, paid at just over $3 million a year.

In late 2002, a court order forced Enron to sell those naming rights back to the Astros for $2.1 million. The Astros were quickly able to find a new buyer, to which the rights still belong, Minute Maid, although Minute Maid merged with the Coca-Cola Company in 2003.

In what probably felt like déjà vu, last year, Crypto Dot Com, a cryptocurrency exchange based in Singapore, made the decision to buy two decades of naming rights to the formerly STAPLES Center in Los Angeles.

This decision came at an incredible cost to the startup: more than $700 million, or almost double what it cost to build the STAPLES Center in the first place. The sum was also nearly four times what it cost Staples to purchase the original naming rights.

On top of the more than $700 million spent on arena naming rightsthe exchange also signed an “eight-figure deal” to put a patch on Philadelphia 76ers uniforms for six years.

So what do you have over three-quarters of a billion dollars spent on basketball marketing alone got the swap? Not much, as far as any outside observer can tell. Crypto Dot Com’s native cryptocurrency Cronos is down nearly 90% year over year. Meanwhile, it has been widely reported that the company faces heavy layoffs in the face of an industry-wide recession.

Read more: Crypto.com is in big trouble, but the warnings were there

FTX heating

The other big change in sports marketing in recent years has been FTX, a Bahamas-based crypto exchange with American Sam Bankman-Fried at the helm. FTX purchased the naming rights to the former American Airlines Arena in Miami in early 2021, a 19-year deal sealed by $135 million. The Miami Heat now officially play at the FTX Arena.

But this wasn’t the only sports marketing the exchange engaged in. He also sponsored an esports team for more than $200 million and has seen his logo plastered on every Major League Baseball umpire. The price of that deal has not been disclosed.

This suggests that FTX spent a half a billion dollars or more in sports marketing alone – and most likely not the most advantageous dollars spent. This year FTX I quit in an attempt to deal with the Los Angeles Angels of Anaheim when the crypto winter took its toll.

Meanwhile, for the first time since FTX was founded, people seem to be questioning whether or not the exchange and its sister trading company, Alameda Research, are. insolvent.

better for last

The most atrocious example of choosing spend money on sports marketing instead of a functional business has to go to the team previously in charge of the TERRA/LUNA algorithmic stablecoin pair.

A deal with the Washington Nationals was signed this year for around $40 million, granting naming rights to an exclusive luxury venue for high-end patrons, along with seats behind home plate covered in ‘TERRA’ for at least one season. of the MLB, possibly many more.

Only months later, the stablecoin pair collapsed into oblivion. Meanwhile, everyone who watched a Nationals game was reminded of the poor treatment throughout the season, with empty seats staring at viewers during every at-bat.

Read more: Cryptocurrency Exchange to Name NBA Stadium in $135M Deal, Replacing American Airlines

Immersed in the curse of naming rights

As the broader economy begins to accept a downturn, cryptocurrency remains at low levels not seen in years. Is the stadium naming rights curse real? Are there more major cryptocurrency crashes in the not-too-distant future? Only time will tell – Crypto Dot Com and FTX hope to buck the trend.

For more informed news, follow us on Twitter Y google news or listen to our research podcast Innovated: Blockchain City.