Cryptocurrency exchange OKX doubles on Manchester City. On Sunday, the company announced it had reached an agreement to extend its existing partnership and become the club’s official training kit partner for the 2022-23 season. The deal will also see select Manchester City players star in crypto-educational content produced by OKX.
Financial terms were not disclosed, but a source said: Forbes that the expanded deal will net the reigning Premier League champions more than $20 million this season. Manchester City named OKX its official cryptocurrency partner in a multi-million dollar deal earlier in March. Forbes believes the club is worth $4.25 billion, the sixth most valuable in the world.
Cryptocurrency has entered the sport in recent years as the industry continues to develop a mainstream presence. FTX, for example, has hired several leading athletes, including Tampa Bay Buccaneers quarterback Tom Brady, Golden State Warriors star point guard Steph Curry and two-way Los Angeles Angels phenom Shohei Ohtani. In February, Crosstown rival Manchester United added blockchain firm Tezos as a sponsor, in a deal worth $27 million a year, according to The Athletic† Last year, French club Paris Saint-Germain added fan token provider Socios.com and trading platform Crypto.com as team sponsors. FIFA also announced in March that Crypto.com would be the “exclusive sponsor of the Qatar 2022 cryptocurrency trading platform”. A Nielsen report from earlier this year estimates that crypto spending in sports will reach $5 billion by 2026.
But the cryptocurrency’s recent downturn, with Bitcoin dropping below $20,000 in June, has cast doubt on the future of the space. In June, Coinbase, BlockFi, Crypto.com and Gemini announced layoffs, causing the loss of nearly 1,700 jobs. BlockFi, of which Pitchbook was last valued at $4.8 billion, is reportedly closing a deal to sell to FTX for $240 million, according to Yahoo Finance. Coinbase stock is down about 76% since the beginning of 2022. On the sports front, FTX has curbed a possible sponsorship of a jersey patch with the Los Angeles Angels, according to the New York Post† The Washington Wizards have also reached an agreement with an anonymous crypto company.
“The market has definitely slowed down,” said Joe Favorito, veteran sports business consultant and educator at Columbia. He adds: “You’ve never seen an emblem removed from an umpire’s uniform or the name removed from an arena. But the additional costs have certainly been reduced, whether it’s for big ads or things like the NBA Finals.
Meanwhile, OKX continues with its expansion plans despite the delay. In addition to partnering with Manchester City, the company’s chief financial markets officer recently told CoinDesk it plans to increase its workforce by 30% with the goal of reaching a workforce of 5,000. Fidelity Digital Assets and Binance have also announced similar intentions in recent months. “OKX’s investments in our partners and our team are independent of the market because our principles and beliefs have not changed,” said Haider Rafique, Marketing Director of OKX. “We intend to select partners that reflect this focus, meaning we have not spent the bull race closing sports deals at an unsustainable pace.”
Founded in 2017 by crypto entrepreneur Star Xu, OKX operates internationally in more than 180 markets and has over 20 million users. Based in the Republic of Seychelles, it is the second largest crypto exchange in terms of derivatives and spot trading volume. By 2021, OKX claims to have processed more than 25 billion transactions with volumes exceeding $21 trillion.