Cal-FTX stadium naming deal ends in a whimper

Article posted by Coliseum, November 22^nd, 2022

Image: University of California

The University of California Berkeley (US) has suspended its stadium naming rights deal with FTX, the bankrupt cryptocurrency exchange, a representative of the Athletic Department of the varsity confirmed in a statement recently.

‘BINANCE’ stated that the deal was originally planned for 10 years and lasted just 450 days. The sponsorship was inked in August 2021 for $17.5 million and was paid entirely in cryptocurrency, and was the exchange’s first partnership in the world of college athletics. It gave the stadium the name FTX Field at California Memorial Stadium.

The 63,000-capacity California Memorial Stadium, commonly known as the Memorial Stadium, is an outdoor college football stadium on the West coast of the United States, located on the campus of the University of California in Berkeley, California.

The University of California, Berkeley is a public land-grant research university in Berkeley, California, US. Established in 1868 as the University of California, it is the State’s first land-grant university and the first campus of the University of California system.

FTX is a Bahamas-based cryptocurrency exchange. The exchange was founded in 2019 and, at its peak in 2021, had over one million users and was the third-largest crypto exchange by volume. Since November 11^th, 2022, FTX has been in Chapter 11 bankruptcy proceedings in the United States court system following a liquidity crisis.

‘BINANCE’ further stated that a UC Berkeley spokesperson declined to comment as to which cryptocurrencies were a part of the deal. The end of the partnership comes on the heels of FTX’s bankruptcy filing submitted very recently.

While FTX branding has been removed from the sidelines of the school’s football field, its logo remains prominently on the front page of the Athletic Department’s website.

The crypto exchange, which spent heavily on sports-related partnerships in the past two years, has seen several of its sponsorship deals fall through in the wake of its collapse, including its 19-year, $135 million stadium naming rights deal with the National Basketball Association (NBA) team Miami Heat (US) and the $210 million esports partnership with gaming brand TSM.

Miami Heat was the first one to cut its ties with the Bahamian-based brokerage. FTX is on the radar of the US Securities and Exchange Commission over its handling of customer funds.

Recently, videos of a grounds crew wiping the FTX branding from its football field made the rounds on Twitter, indicating movements to remove the partnership.

On November 11^th, a representative from the school’s Athletic Department called FTX “a great partner for Cal Athletics”, saying it was closely monitoring the situation.

The California Golden Bears are the athletic teams that represent the University of California, Berkeley. Referred to in athletic competition as California or Cal, the university fields 30 varsity athletic programs and various club teams in the National Collegiate Athletic Association (NCAA)’s Division I primarily as a member of the Pac-12 Conference, and for a limited number of sports as a member of the Mountain Pacific Sports Federation (MPSF).

‘PYMNTS’ stated that a statement sent out by Cal Athletics read, “Learfield’s Cal Bears Sports Properties, working in collaboration with Cal Athletics, has suspended the FTX naming rights sponsorship with Cal Athletics.”

In February this year, sponsorship consulting firm IEG said that the amount North American companies in the crypto industry were spending on sports sponsorships could amount to over $160 million – more than the amount spent by airlines, quick-service restaurants and wine and spirits companies.

‘PYMNTS’ further stated that by September, some sports sponsorship deals had gone south as the crypto sector had been taking a dive that had already lasted months.

Still, the sports sector was hanging on to sponsorships from companies in the crypto sector even if some of the bigger names in digital assets had pulled out of deals and the cryptocurrency fallout had triggered a wave of repercussions across multiple industries.

The news from UC Berkeley comes on the same day (November 17^th) that John J. Ray – who was appointed the Chief Executive Officer (CEO) of FTX as part of the crypto exchange’s bankruptcy proceedings – said he’s never seen a company as “badly run” as FTX.

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