Adam Fitch: Are cryptocurrency sponsors bad for esports?
While esports is an industry itself, one some claim is worth over $1 billion, it’s also a hotbed of trends. Fromathletesandmusiciansrushing to invest in teams to even fast-food companieslaunching channelsto accommodate gamers, it’strendyto be involved with an industry people believe will be the next big thing. The new trend involves cryptocurrency.
While the values of these deals weren’t disclosed — as is the norm in esports — Astralis, who are a household name in Denmark, claimed that it was the “largest partnership deal [they] have entered to date.” This is very telling considering they’re already entered agreements with huge companies like Garmin, Audi, hummel, Logitech, and HP. Other recent examples of the convergence of crypto and esports include FTX and LCS, Coinbase withBIG,Evil Geniuses,ESL, andBLAST,Uniswap and Team Secret,NBX and Nordavind,Rally and Gen.G, andBinance and OG. Oh, and of course we’ve had Socios partner with esports orgs to offer “fan tokens” for quite some time.
There are certainly questions of sustainability yet to be answered. While some currencies and technologies have existed for a while, more and more are popping up on what appears to be a daily basis and there’s no doubt in my mind that only a small percentage will ever be successful, sustainable, and devised in a way that negates any nefarious plotting from the ‘founders’. Let’s put the sustainability comment into context. TSM are getting $21m a year, for 10 years, from FTX. Despite the exchange recently beingvalued at $18b, there are no guarantees that they will last the term. The same goes for TSM, mind you. Regardless, what if TSM are operating under the assumption that they’ll see all $210m and make some big investments (whether into infrastructure or acquiring other companies), and then FTX folds one day? What if FTX is involved in a legal matter that tarnishes their reputation as a fair, reliable exchange and TSM can’t afford to back out of their deal? That’s negative brand association for potentially many years to come.
