Crypto.com Suspends Institutional Trading But Sports Sponsorship Deals Unaffected

[ad_1]

Crypto.com made deals with AEG, Formula One No Crypto.com arena name change as a result

Crypto.com is suspending its institutional cryptocurrency exchange in the United States as part of a development, but will maintain title sponsorship of the National Basketball Associations (NBA) Los Angeles Lakers domestic arena.

The Singapore-based company cited limited demand for the shutdown, which is expected to affect 400 customers, while tough market conditions are also likely to have been a factor.

US authorities have increased pressure on the sector in recent months, seeking to tighten and enforce regulations on trading in cryptocurrency assets. Many investors, exchanges and providers have either withdrawn services or sought to offshore operations in response.

Crypto.com kept the door open for a restoration of the exchange, but gave no timeline for such a move.

In the meantime, its consumer-facing service remains unchanged, with its retail platform still operational in the United States.

We remain fully confident in the continued success of our market differentiation capabilities and offerings and will continue to offer all other regulated services in the markets in which we operate, Crypto.com said in a statement to ESPN.

Crypto.com sports sponsorships are also believed to be unaffected. The company signed a 20-year, $700 million naming rights deal with AEG to rename the venue previously known as Staples Center. In addition to the Lakers, the facility also hosts the Los Angeles Sparks of the Womens National Basketball Association (WNBA) and the Los Angeles Kings of the National Hockey League (NHL). The Lakers’ local NBA rivals, the Los Angeles Clippers, will move from the site to the Intuit Dome in 2024.

Other partnerships include Formula 1, for which Crypto.com is the title sponsor of the Miami Grand Prix, and the National Womens Soccer Leagues (NWSL) Angel City FC. The firm was also a partner of the 2022 FIFA World Cup.

SportsPro says

The sports industry’s relationship with cryptocurrency has been two-fold. Blockchain-based token technologies are seen as both a potential tool for fan engagement and a source of new business revenue, whether through the sale of new digital products or through sponsorship.

Although business is business as usual at Crypto.com, the regulatory environment in the United States, coupled with a continued market downturn, should remain a source of concern for the sport. The market for many non-fungible collectibles (NFTs) has stagnated or failed to meet expectations, while major players have faced lawsuits alleging that these products are in fact unregulated securities. NFTs and Web 3.0 are no longer the source of optimism they were in 2021.

Sponsorship is also drying up. Many teams, federations and athletes have rushed into (sometimes ill-judged and unfortunate partnerships) and Crypto.com has been one of many companies to cut interest in the wake of the industry-wide downturn.

One of the reasons for the speculation regarding the Lakers arena was the collapse of another exchange, FTX, late last year. FTX owned the naming rights to the Miami Heats arena and had league-wide agreements with the NBA, as well as the Mercedes Formula 1 team and the International Cricket Council (ICC), among others.

[ad_2]