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Formula 1's Crypto.com Sponsor Is Falling Apart
Formula 1's Crypto.com Sponsor Is Falling Apart-October 2024
2024-02-19 EST 22:10:48

Max Verstappen after winning the 2022 Crypto.com Miami Grand Prix.

If you’ve watched a Formula 1 race this year, there’s a good chance you have — if only unconsciously — seen plenty of Crypto.com ads. Along with companies like Aramco, DHL, Emirates, and Heineken, Crypto.com has looked like it’s become one of the key players in financing the future of global open-wheel motorsport. But right now, all that money might be drying up.

A new report from ’s Asa Hiken describes a company that has marketed itself into a downward spiral. If you’ve watched any sporting events in the recent past, you’ve probably either seen a commercial or an eventside ad for Crypto.com, a cryptocurrency exchange platform. Now, it looks like thousands of employees are being let go as the “crypto winter” descends.

Just after Crypto.com announced that it had hit the 50-million user mark — and just after it had served as a primary sponsor for F1's Miami Grand Prix — the crypto market crashed.

From Ad Age:

In the months that followed, Crypto.com quietly downsized many of the partnership deals intended to garner mainstream attention for the brand, and in some cases the firm has attempted to pull out from these deals altogether, according to details shared by former and current employees at the company who spoke with Ad Age on the condition of anonymity.

The exchange also saw a reduction in its headcount of previously unreported scale, with 30% to 40% of its pre-summer workforce departing the company from June through August—the vast majority of which were due to layoffs, according to former and current employees.

A lack of internal directories prevented Ad Age from confirming exact numbers, as well as differentiating between layoffs and natural attrition, but multiple sources independently stated that just over 2,000 employees have left the company since layoffs began. Crypto.com was previously reported to have let go of just over 1,000 employees at most. Marketing personnel were some of the first to be targeted by the layoffs, including an entire in-house creative team that was eliminated mere months after its creation, sources said.

In the article, one advertising professional who worked with Crypto.com described the company as follows: “I’ve worked with many ambitious clients before, but Crypto.com is probably the most ambitious client I’ve ever worked with.” That’s because, in a span of less than a year, the brand became internationally known thanks to its intense marketing push that saw it become a massive enterprise. It worked well at getting Crypto.com’s name out.

But a downturn in crypto interest saw the platform tumble. Crypto.com has dissolved deals with Angel City F.C., Twitch Rivals, and the UEFA Champions League. It has maintained several other deals with sports teams or events but has in some cases reduced the number of hospitality packages available.

Right now, the future of Crypto.com and cryptocurrency as a whole is a little unclear. It obviously hasn’t become a universally adopted form of currency, and the initial allure seems to have faded. It could keep tumbling, or it could see a new rise in interest. Formula 1 likely won't fall apart thanks to Crypto.com — but it's yet another fascinating chapter in the sport's long history of accepting sponsorship deals that aren't quite cut out to meet their promises.

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