The downfall of FTX happened rapidly following the watchdog journalism from the cryptocurrency news site CoinDesk, which published an article<\/a> on Nov. 2 that uncovered disturbing connections between Sam Bankman-Fried’s FTX crypto exchange and Alameda Research, the cryptocurrency trading firm also founded by Bankman-Fried. CoinDesk unveiled Alameda\u2019s financial balance sheet recorded its largest asset to be roughly $5 billion worth of FTT, the token native to FTX that gives holders a discount on trading fees on its marketplace.<\/p>\n The revelation prompted Changpeng Zhao, the CEO of rival crypto exchange Binance, to announce Nov. 6 on Twitter that he would sell all of Binance\u2019s holdings in FTT. The public then lost faith in FTX, withdrawing about $6 billion in funds from FTX to send the company \u2014 which was valued at $32 billion \u2014 into a liquidity crisis.<\/p>\n Binance<\/a> announced Nov. 8 that it reached a nonbinding agreement to buy FTX\u2019s non-U.S. businesses but announced Nov. 9 that it had backed<\/a> out of the bailout deal. \u201cAs a result of corporate due diligence, as well as the latest news reports regarding mishandled customer funds and alleged US agency investigations, we have decided that we will not pursue the potential acquisition of FTX.com,\u201d read a statement from Binance. The Wall Street Journal reported<\/a> on Nov. 9 that the Securities and Exchange Commission and Justice Department are investigating FTX. On Nov. 11, FTX, FTX.US, Alameda Research, and more than 100 affiliates filed for bankruptcy in Delaware.<\/p>\n SBJ Marketing: Crypto category’s cloudy condition<\/a><\/em><\/p>\n \u201cI didn’t ever try to commit fraud on anyone. I was excited about the prospects of FTX a month ago. I saw it as a thriving, growing business,\u201d Bankman-Fried said from the Bahamas on Nov. 30 in a remote video interview during the New York Times DealBook Summit<\/a>. \u201cWhat I was nervous about was that basically \u2013 and this started, I would say Nov. 2 or so when there was the leak of the Alameda balance sheet through CoinDesk. When I started to think a bit more about this, I was nervous that that would lead to substantial losses for Alameda and that it would be a bit messy. I didn’t think it was existential for FTX. I didn’t think it was going to lead to a massive loss for FTX’s customers.\u201d<\/p>\n Andrew Ross Sorkin, who conducted the recent NYT DealBook interview, read a letter to Bankman-Fried “from a gentleman who said he lost his life savings” in FTX. “Andrew, can you please ask SBF why he decided to steal my life savings and the $10 billion more from customers to give to his hedge fund, Alameda?\u201d the user wrote in the letter ready by Sorkin.<\/p>\n SBJ Spotlight: Sports leaders opine on state of crypto<\/a><\/em><\/p>\n On Dec. 1, Congress held its first hearing<\/a>\u00a0regarding the matter where\u00a0Rostin Behnam, chairman of the Commodity Futures Trading Commission (CFTC), pushed for industry oversight.<\/span><\/p>\n “I strongly b<\/span>elieve that we need to move quickly on a thoughtful regulatory approach to establish guardrails in these fast-growing markets of evolving risk,”\u00a0Behnam said. “<\/span>Failure to act will leave consumers who have made investments in digital commodities largely unprotected.”<\/p>\n “Unlike other federal financial regulators, the CFTC lacks the necessary and direct authority to write rules and oversee this marketplace. Instead, we may only reach it through more limited authority\u00a0activated when fraud or manipulation has already occurred. While we can and do hold perpetrators accountable when we find fraud or manipulation, for the victims of the scheme, it’s already too late.”<\/p>\n Tom Brady, Steph Curry, Naomi Osaka, Shohei Ohtani, David Ortiz, Shaquille O\u2019Neal, and Trevor Lawrence are among the star athlete FTX endorsers who have been named in lawsuits<\/a> against the company. Here is a timeline of the major sports sponsorships signed by FTX:<\/p>\n The Miami Heat and Miami-Dade County signed a 19-year, $135 million deal<\/a> with FTX to rename the Heat\u2019s venue to FTX Arena. The team was to receive $2 million a year as part of the now-terminated<\/a> naming rights deal with FTX. Most of the rest \u2014 roughly $90 million \u2014 was to be paid to the county with the vast majority to be allocated toward fighting gun violence and poverty, according to ESPN<\/a>.<\/p>\n In November 2022, the Miami Heat announced plans to end its relationship with the crypto firm and rename FTX Arena.<\/p>\n<\/div>\n Esports organization TSM agreed to be paid $210 million by FTX<\/a> over 10 years in a deal that saw the team compete under the name Team SoloMid FTX. TSM has suspended<\/a> its deal with FTX and dropped the company\u2019s branding.<\/p>\n MLB signed a reported five-year umpire patch deal with FTX, becoming the first major North American pro sports league to have a league-wide cryptocurrency exchange partner.<\/p>\n The FTX patch can be seen on umpire Greg Gibson’s uniform during a Tigers-Athletics game earlier this year.<\/p>\n<\/div>\n Multiple Bitcoin giveaway contests<\/a> for fans were hosted by MLB and FTX over the course of the deal, which will not continue next season. \u201cObviously, the FTX development was a little jarring. We have been really careful moving forward in this space,\u201d said MLB commissioner Rob Manfred<\/a>.<\/p>\n The now-divorced husband-wife duo were announced as FTX shareholders in a long-term deal that saw both appear in several commercials for FTX across social media and TV. \u201cI\u2019m in. Let\u2019s call everyone,\u201d Brady said in one ad spot<\/a> in which he\u2019s then shown making calls to a Jets fan, dog walker, restaurant worker, surgeon, plumber, among other characters being talked into crypto by the NFL legend.<\/p>\n UC Berkeley signed a 10-year, $17.5 million deal<\/a> for the Golden Bears\u2019 football stadium to be renamed FTX Field at California Memorial Stadium. That agreement has been suspended and at the time the deal was signed in Aug. 2021, Cal Athletics\u2019 media rights holder Learfield said it agreed to accept the entire payment from FTX in the form of cryptocurrency.<\/p>\n Formula One team Mercedes AMG Petronas<\/a> signed a multi-year deal to have the crypto brand\u2019s logo appear on its race cars and drivers. Mercedes F1 later said it was launching a \u201cnew era of fan collectibles\u201d with FTX in April through commemorative NFT ticket stubs<\/a> and NFT artwork of cars raced by Lewis Hamilton and George Russell around the Miami Grand Prix. The FTX deal was suspended<\/a> Nov. 11.<\/p>\n The four-time NBA champion received equity in FTX and became a global ambassador for the firm. \u201cI\u2019m not an expert and I don\u2019t need to be. With FTX, I have everything I need to buy, sell, and trade crypto safely,\u201d Curry said in a March 2022 FTX commercial<\/a> titled \u201cStephen Curry is Not a Crypto Expert.\u201d<\/p>\n FTX agreed to pay $10 million to the Warriors for its branding to appear at Chase Center and on regional broadcasts, according to CNBC<\/a>. FTX became the first international rights partner of the Warriors and the team\u2019s official NFT Marketplace partner. FTX sold NFTs<\/a> that fans could buy to earn prizes such as NBA Finals tickets, autographed items, Warriors NBA Championship Rings, additional NFTs, and merchandise. The Warriors are now being sued<\/a> by and FTX customer who accused the team of “fraudulently promoting the now-bankrupt cryptocurrency exchange.\u201d<\/p>\n A multi-year deal saw FTX become the exclusive NFT partner<\/a> of the NBA\u2019s Washington Wizards, WNBA\u2019s Mystics, and NHL\u2019s Capitals. In Feb. 2022, fans in the DMV-area were encouraged to download the FTX app to sign up for a sweepstakes<\/a> that would reward them with free NFTs and give more than $40,000 in Bitcoin to select winners. MSE suspended its partnership with FTX on Nov. 18 but said it would continue to host four Wizards fan giveaways sponsored by the crypto company.<\/p>\n FTX U.S. became the presenting sponsor for the Nerd Street Championships<\/a> and of community events held at Nerd Street\u2019s nine esports facilities across the U.S. This deal came six months after FTX inked a separate seven-year esports sponsorship the League of Legends Championship Series.<\/a><\/p>\n<\/div>\nApril 2021: Miami Heat<\/h3>\n
![\"In](\"https:\/\/sporttechie-prod.s3.amazonaws.com\/ftx_arena_image_in_story.png\")
<\/p>\nJune 2021: TSM Esports<\/h3>\n
June 2021: MLB<\/h3>\n
![\"The](\"https:\/\/sporttechie-prod.s3.amazonaws.com\/ftx_mlb_patch_to_use.png\")
<\/p>\nJune 2021: Tom Brady & Gisele B\u00fcndchen<\/h3>\n
August 2021: University of California, Berkeley<\/h3>\n
September 2021: Mercedes F1<\/h3>\n
September 2021: Stephen Curry<\/h3>\n
December 2021: Golden State Warriors<\/h3>\n
December 2021: Monumental Sports & Entertainment<\/h3>\n
February 2022: Nerd Street Esports<\/h3>\n