DeutschCrypto fans who closely follow the latest market developments have noticed for some time that cryptocurrencies such as Bitcoin and Ethereum are increasingly being accepted into the so-called mainstream. This includes the fact that more and more traditional banks and financial service providers are entering the competition with their own trading platforms. At the same time, there are repeated reports that big names in the crypto world are investing in (sports) sponsoring in a sometimes massive way in order to attract more attention to their offerings beyond the circle of those who already invest in or speculate with digital currencies. The number of crypto companies that spend money on advertising and partnerships is constantly increasing. The pressing question is: What is the reason for this costly commitment? After all, crypto trading is still prohibited in many countries, or at least in a gray area.
eToro as one of the Major Pioneers
The advertising-effective connection between crypto companies and various sports is gaining momentum. For some time now, there have been increasing reports about partnerships in the area of sponsoring. One of the first leading platforms to act as a sponsor was the crypto exchange eToro. The operator announced plans to financially support soccer teams in the English Premier League as early as 2018. The special feature at that time was not least that sponsorship money should also flow in Bitcoins. In the summer of that year, the company advertised that it was the first company to take this step in the environment of the country’s most important soccer league.
This was also a risk for the seven clubs, such as Tottenham Hotspur and Newcastle United, who agreed to the partnership, according to reports at the time. At that time, digital currencies played a much smaller role in the mainstream than they do today. The partnership was initially designed for six months.
Crypto.com opens the “war chest” wide for sponsoring
The agreements of the company Crypto.com are much longer-term. The service provider’s sponsoring deals, which were reported in July 2021, relate to two popular sports. On the one hand, the crypto giant secured a real heavyweight in the industry with the Mixed Martial Arts organization Ultimate Fighting Championship (UFC). The Crypto.com logo is to be emblazoned on the jerseys of the association’s athletes and on Fight-Kit articles for several years. Experts believe that the company has the potential to increase its customer numbers through the far-reaching deal. But at the latest, sponsoring in Formula 1 should have the hoped-for advertising effect.
This area is about the “Sprint” opening series. This is undoubtedly the next important step in sports sponsoring. These agreements were also made public in July 2021. Crypto.com is said to be investing more than 100 million US dollars and, in return, will be represented with its branding on Formula 1 racetracks for at least five years.
This area is about the “Sprint” opening series. This is undoubtedly the next important step in sports sponsoring. These agreements were also made public in July 2021. Crypto.com is said to be investing more than 100 million US dollars and, in return, will be represented with its branding on Formula 1 racetracks for at least five years.
Other Crypto Companies are also Committed Sports Sponsors
The well-known fund manager Grayscale Investments and the crypto platform CoinDeal have also recognized the signs of the times. In May 2021, Grayscale Investments announced a partnership with the National Football League (NFL) team New York Giants. As a result, the asset manager can call itself the official Digital Currency Asset Management Partner of the club. The enormous Crypto.com investment has so far stood out from the mass of reports. But other crypto companies are also spending millions on their measures. However, industry experts assume that the examples mentioned could only be the beginning of a whole wave. The decisions offer plenty of room for discussions about the reasons on the one hand and about the sense and purpose on the other – especially against the background of the difficult legal situation in many countries.
Worth reading: Altcoins, Bitcoin and soccer – A strong partnership?
Positive Consequences could Become Apparent above all in the Medium Term
With a view to the crypto bans existing in many countries, some sponsoring may actually seem a bit exaggerated and give the impression that crypto companies are threatening to lose all sense of proportion. Some critics speak of megalomania due to the impressive success of the crypto sector, which is attracting more and more “normal” investors. At the same time, there are numerous positive voices. For example, many crypto investors are not deterred by regulatory difficulties. Also, greater recognition of the crypto market and a relaxation of strict regulation are on the horizon in many places. This should be a reason for the sponsoring investments.
If the traditional market opens up for Bitcoin and altcoins, active sponsors are likely to be at a clear advantage thanks to their awareness. A similar scenario existed years ago in the area of sports betting. Here, the activity in a gray area was also no obstacle for financially strong providers when many leagues and clubs increasingly opened up to partnerships.
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