Inter Miami CF is looking for sponsorship money in calmer seas.
The team, including captain Lionel Messi, will start the 2024 season with their jerseys bearing the Royal Caribbean Cruises logo instead of cryptocurrency investment firm XBTO, according to a statement. Financial details were not disclosed.
Since the FTX collapse in 2022 rocked the industry, sports sponsorship by cryptocurrency companies has dwindled. XBTO signed a multi-year partnership with the team in 2021 which now expires after just three years. XBTO did not immediately respond to a request for comment luck.
Meanwhile, the cruise industry, with its less controversial brand, was booming. Thanks to last year's post-pandemic travel rebounds, cruise lines like Royal Caribbean (112%), Carnival (130%), and Norwegian (64%) saw big gains in their stock prices before pulling back in early 2024.
The Miami-based soccer team's deal with Royal Caribbean highlights the sports world's broader pivot away from crypto money and back toward safer, traditional industries.
Hot from the press: @InterMiamiCF Suitable for a new front-end partner, @Royal Caribbean. The partnership was unveiled in an exciting ceremony today #Icon_of_the_Seas. | Version: https://t.co/mn4tGFzqdE 🚢⚽️ pic.twitter.com/BCDPFs1Frk
— Royal Caribbean Public Relations (@RoyalCaribPR) January 24, 2024
Boom and bust
Like beer in the late 1990s, airlines in the early 2000s, and then telecom companies in the mid-2000s, cryptocurrencies and sports seemed, at least a few years ago, a perfect marriage.
For crypto companies, sports deals promised big audiences, plus the brand association gave credibility to a new sector that many consumers would likely view as risky, said Francis Dumis, co-founder of sponsorship marketing agency Elevent.
“It was a way to show a lower sense of risk,” Dumais said. luck. In return, the industry can offer lucrative deals. “It wasn't so much a case of cryptocurrencies as it was a new gold rush that sports real estate couldn't ignore.”
“Sports fans are typically male, and the appeal of cryptocurrencies to this group meant that sports partnerships were a great way to generate interest,” Konrad Wiacek, head of sports analysis and consulting at GlobalData, added via email.
In 2021, Crypto.com signed a 20-year, $700 million deal to acquire the naming rights to the Los Angeles arena that is home to the Lakers, Kings, and Sparks, formerly known as Staples Center. Meanwhile, Coinbase signed a wide-ranging four-year, $192 million deal with the NBA, and NFL quarterback Tom Brady agreed to receive $55 million from FTX for just 20 hours of his time per year.
Miami is home to FTX Arena, home of the NBA Heat. The facility opened in 1999 as American Airlines Arena, but in 2021, the county ended its deal with the airline, replacing it with an agreement with FTX that paid far more than the $2.1 million annually the airline had agreed to pay. The arena was renamed as part of a 19-year, $135 million deal.
But after FTX collapsed, a federal bankruptcy judge agreed to terminate the agreement between the exchange and Miami-Dade County, according to a court filing. The arena was renamed last year to the Cassia Centre, after IT and security software company Cassia bought the rights.
The FTX Arena deal was part of a local rebranding effort after Miami Mayor Francis Suarez, in January 2021, took to Twitter to declare his city the cryptocurrency capital of America. “The city of Miami believes in #Bitcoin.” chirp“And I work day and night to transform Miami into a hub for cryptocurrency innovation.”
More breakups
Last January, Scuderia Ferrari, the racing division of luxury automaker Ferrari, exited multi-year partnership deals with Velas Blockchain and chip manufacturing giant Snapdragon, resulting in the Italian team losing $55 million. The Ferrari-Velas partnership from 2021 – worth $30 million annually – aims to increase fan engagement through NFTs.
In November, Mercedes lost $15 million after suspending its partnership with FTX as the exchange filed for Chapter 11 bankruptcy. Formula One team Red Bull Racing also ended its partnership with blockchain platform Tezos Foundation early and suffered similar losses, with Tezos reportedly deciding not to renew its agreement. , indicating a flaw in the strategy.
Underpinning the shift away from crypto patronage, in addition to bankruptcies and failed companies, is the industry's penchant for cheery headlines, including Sam Bankman-Fried's fraud conviction and plea agreement with Binance CEO and co-founder Changpeng Zhao. Furthermore, lawsuits are currently being filed against the Binance and Coinbase exchanges, which are accused of operating as unregistered brokerages.
