In 2021, it felt like every week a crypto company joined forces with a sports team or athlete. Fast-forward to today’s stagnating crypto market: Those partnerships still exist, but they’re less talked about.
I wondered whether these alliances were paying off in a meaningful way, so I asked a few people from major crypto companies and blockchains like FTX, Ava Labs and Algorand to talk about it.
“Sports audiences tend to overlap with crypto,” Avi Dabir, vice president of business development at FTX, said to TechCrunch. “You can hit a mass market by partnering with trusted teams, brands and athletes and your sports viewer tends to be in finance and crypto and so on.”
FTX was one of the first crypto companies to really dive into sports partnerships. It began talking about collaborations with sports entities in January 2021 because it wanted to enhance the value and awareness of its brand, Dabir said.
Last year, FTX signed a 19-year, $135 million agreement with the Miami Heat to rename its home court to FTX Arena. The company is also the official crypto exchange sponsor of Major League Baseball and has partnered with individual athletes like Tom Brady and Steph Curry.
“I really believe [the partnerships] paid off,” Dabir said. “The things we look at — some are measurable and some are not.” The obvious measurement is how many people signed up or downloaded the FTX app, but there are other aspects that are harder to quantify, he added.
“Like the brand value these partnerships bring and the trust it adds to our platform and how many more people are generally aware of FTX,” Dabir said. “People in Miami can name the FTX Arena and know it’s a cryptocurrency exchange. It’s hard to put a dollar amount on that, but it’s valuable for sure.”
It helps aid in business deals — whether it be with an institutional firm that wants to trade on FTX’s platform or a real estate developer — because they’ve heard of the company, Dabir said. “It makes the conversation much easier because our brand recognition has increased and they know what we’re doing.”
For Ava Labs, the company behind the layer-1 blockchain Avalanche, the “brand is built in the heart,” Devon Ferreira, chief marketing officer at Ava Labs, told TechCrunch. “We thought about how we can show up where the community is and give them something to care about, so we started talking about sports.”
Avalanche partnered with the Andretti Formula E team in October 2021. At the time of the announcement, Formula E had a global audience of about 316 million viewers, up 32% year over year, the team said in a post.
“We’ve been mindful and purposeful in our partnership,” Ferreira said. “There’s a lot of deals in this business, but we haven’t done too many partnerships because it’s not just about making noise but doing something meaningful.”
While it took time for the partnership to gain momentum, a race in London at the end of July was a “pinnacle moment for this whole investment,” Ferreira said. Avalanche Andretti’s driver, Jake Dennis, won the first race in the SABIC London E-Prix doubleheader.
“That week on social media, if that’s any gauge of success, about 71% of our social engagements came from the Avalanche Andretti social media team,” Ferreira said. “We had 5 million impressions from the race and the team, and if we look at the stats, if you go back even before London, when we raced in NYC in Brooklyn, the crypto Twitter buzz around that event compared to others in the industry was killing it.”
This season alone, Avalanche has been “exposed” to over 312 million people in cities like Marrakesh, London, Rome and Monaco, and next year, it’ll race in Brazil and India, too, Ferreira noted. “These are key markets in crypto and for us to build a community.”
“You’re seeing the definition of sports expand itself from the physical to the virtual and digital to find ways to engage closely with fans, drive new growth and content creation,” Sean Ford, interim CEO of Algorand, said to TechCrunch. “We’re seeing a moment of disruption for the way sports teams look at their economic model and get closer to fans.”
Algorand has partnerships with the Drone Racing League, FIFA and NY Gotham FC, Ford noted. The blockchain-based company sees those partnerships as entry points for technical innovation, he added.
“These partnerships are going to only exponentially grow and the teams that are going to win are the ones that break old revenue models and think outside the box with crypto,” Ford said.
Since partnering with those teams, Algorand has had more activity on its blockchain and more accounts and wallets being opened, Ford said. “There’s a higher value of exchanges happening.”
“There’s a deep, strong emotional connection between fans and their teams and that stickiness of the broader fan base gives greater opportunities for organizations in the space to innovate and give new products for fans to feel close,” Ford said. “From our perspective, we’ve already seen evidence of it.”
In the long term, all three crypto companies said they see this as just the beginning and are open to more opportunities in the future.
The energy to get into the crypto space and experiment is incredibly high across every major sport, Ford said. “It’s an exciting time, and the people and leagues who want to step in can step in early and do great things for their fans.”
“Mass [crypto] adoption is going to come from killer applications, but I personally think it’s going to come from culture, too,” Ferreira said. For example, FC Barcelona has over 250 million fans, Ferreira said. “Now, what could you do if you put all that fan loyalty on-chain? What economy can you make around that brand?”
The past year has been focused on increasing crypto brands’ awareness, Dabir said. “A lot of people didn’t know about crypto and the brands in crypto. Sports helped amplify and grow that.”
The next step may be integrating crypto products with these teams now that the idea of crypto is out there, Dabir said.
“It’s about implementing crypto in everyday life,” he said.
Ford noted there are opportunities to integrate crypto through NFTs, ticketing, and so on to blur the line between the physical arena and virtual to “reduce space between teams and fans.”
“We see sports having an interest to innovate and extend their reach,” Ford said.
But the key piece of the integration is connected to the fan experience, Dabir said. “If we’re not doing the fans right, none of these integrations will work.”
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