Esports Giant TSM Suspends $210M FTX Naming Rights Deal

Popular esports club Team SoloMid (TSM) announced today that it has suspended its 10-year, $210-million sponsorship deal with FTX after the cryptocurrency exchange collapsed last week amid a liquidity crunch.

TSM, ranked by Forbes as the most valuable team organization in esports, signed the decade-long naming rights pact with FTX in June 2021. On Friday, the team tweeted that it was “consulting legal consultation” to determine next steps following FTX’s bankruptcy filing.

“After monitoring the evolving situation and discussing internally, we’re suspending our partnership with FTX effective immediately,” the team tweeted in a statement today.

The team said that it will remove all FTX logos from jerseys, team branding, and social media—although it’s still part of the team’s Twitter name due to recent changes to Twitter’s verification system. Team SoloMid has gone by the name TSM FTX since inking the deal.

The $210 million sponsorship was the richest disclosed deal that FTX signed amid a flurry of sports sponsorships in 2021 and early 2022, including pacts with Major League Baseball, the NBA’s Miami Heat and Golden State Warriors, and F1 team Mercedes-AMG Petronas.

FTX Spent Hundreds of Millions of Dollars on Sports Marketing on Road to Bankruptcy

Crypto derivatives exchange FTX launched in 2019 and soared to a $32 billion valuation in just three years—now the rocket ride is ending in Chapter 11 bankruptcy. Along the way, the company—flush with trading fee revenue from the mainstream crypto boom during the pandemic—spent big on sports marketing deals to raise customer awareness. In the second half of 2021 alone, FTX and/or FTX US signed deals with the NBA's Miami Heat (stadium naming rights), Major League Baseball (as the official crypto...

FTX also signed a few other esports deals, including a seven-deal sponsorship of Riot Games’ League of Legends Championship Series (LCS), although terms were not disclosed. Other FTX esports sponsorships include agreements with Brazilian team Furia and the Comcast-backed tournament organization, Nerd Street Gamers.

Despite the size of the TSM deal, which is also the largest known esports sponsorship by a crypto organization, the team said that it will be fine without the exchange’s backing.

“TSM is a strong, profitable, and stable organization. We forecast profitability this year, next year, and beyond,” the team tweeted today. “The current situation with FTX does not affect any part of TSM’s operating plan, which was set earlier this year.”

Mercedes-AMG Petronas similarly suspended its FTX deal on Friday and removed the logo from its F1 car. Soon after, the Miami Heat said that it will remove the exchange’s branding from its FTX Arena venue.

 NFT Revolution

How Crypto and Esports Are Fueling Each Other’s Growth

When cryptocurrency exchange FTX announced a 10-year, $210 million sponsorship and naming rights agreement with leading esports club Team SoloMid (TSM) in June 2021, the towering terms sent shockwaves throughout both the crypto and esports worlds. But it wasn’t the first major move aligning the two buzzy, tech-centric industries. Popular teams like OG and Team Vitality launched crypto fan tokens via the Socios platform a couple years back, generating revenue while engaging fans and letting them...

FTX was one of the best-known cryptocurrency exchanges with a rising star aided by its various sports sponsorship deals and athlete endorsements. However, last week, the exchange said that it had experienced a liquidity crisis and could not meet its customer obligations. Rival exchange Binance considered buying FTX to bail it out, but ultimately pulled out due to the extent of FTX’s troubles.

On Friday, founder Sam Bankman-Fried announced that FTX and its related companies had filed for Chapter 11 bankruptcy protection, and that he had stepped down as CEO. He has since said that he’s still looking to raise funds to try and rescue FTX and return billions of dollars’ worth of assets to customers.