Crypto Arena Was The Peak
Granted that crypto advertisement has no direct correlation with the price of Bitcoin, the amount of crypto advertisements is indicative of the ongoing health of the crypto industry.
In broad terms, when crypto prices are rising, the ad budgets of crypto companies swell.
The reverse is true in a down market.
It’s no surprise that November 2021 marked the high-water mark for crypto advertising spend as crypto.com signed a breakthrough deal for the naming rights to the home arena of the Los Angeles Lakers and ice hockey team LA Kings and called the venue Crypto.com Arena.
My sources told me the deal was a 20-year contract worth $700 million.
The price of Bitcoin has tumbled since then and the first shoe to drop were the numerous job cuts of reputable crypto companies like Coinbase.
The number of crypto exchanges that went bankrupt also has frightened investors as it highlights the unsecured and uninsured nature of digital investments on these platforms.
Individual accounts usually don’t receive their funds back if the exchange they use goes bankrupt, because these accounts aren’t insured.
As the textbook crypto investor has been busy getting impoverished, crypto companies have pulled back investment, wage, and advertisement spend signaling that the industry is in a “crypto winter.”
No industry is at its peak during a bout of extreme scarcity mentality.
This violent pullback of investment has hurt the image of the crypto industry while strengthening the case that fiat money still has validity.
I say that even as the President of Russia Vladimir Putin said yesterday that the U.S. Dollar and European-based Euro have “lost their credibility as a basis of international settlement.”
That’s not necessarily true.
Yet, this does signal that things are about to get wild in the currency markets and the sad fact that interest in digital currencies has, at least for the moment, been put on the back burner as we duck and weave from crisis to crisis.
Unfortunately, the incremental investor still isn’t willing to jump into crypto headfirst and the price of Bitcoin reflects this sentiment.
Just last week, we then got news of the same Crypto.com reportedly pulling out of a five-year sponsorship deal with the UEFA Champions League.
This UEFA Champions League competition is the most prestigious non-World Cup soccer tournament in the world and dominates global eyeballs.
The deal would have been worth just over $100 million annually.
Valued at just over $100 million per year, the contract had been under discussion but never signed, according to my sources.
The move follows the exchange's official approval as an official FIFA World Cup sponsor in March and several other audacious marketing plays in the world of sport.
Several other sports marketing opportunities have also been permanently shelved underscoring how lean times are in the world of digital currencies.
The price of Bitcoin has participated in the price action to the downside while missing out on much of the upside.
There simply is a lack of trust in this speculative asset class as hyperinflationary times have forced people to migrate into hard assets like food, energy, and housing.
