New York (CNN Business)Baseball’s newest superstar is lending his global celebrity status to one of the fastest-growing brands in the crypto world.
On the heels of an historic season, Los Angeles Angels phenom Shohei Ohtani is joining cryptocurrency exchange FTX as a global ambassador and taking a stake in the company, FTX told CNN Tuesday. The deal is the latest in a flurry of major sponsorship agreements for FTX, an exchange run by 29-year-old billionaire Sam Bankman-Fried that launched in 2019.
Bitcoin falls as China takes aim once again at 'extremely harmful' crypto miningFTX is hoping Ohtani — a rare dual threat known for blasting towering home runs from the plate and striking out batters from the pitching mound — will elevate awareness around the world for a brand that is not yet a household name.
“He’s obviously one of the most electric players in all of sports right now,” Bankman-Fried, whose net worth Forbes pegs at $26.5 billion, told CNN in a phone interview. Read MoreLast season Ohtani — whose compensation for the sponsorship will be paid entirely in cryptocurrency and FTX equity — became the first player in MLB history to be selected as an All-Star as both a pitcher and a batter. “We are hoping to have a similarly revolutionary impact on what fintech means and what personal finance apps look like,” Bankman-Fried said. FTX is the world’s third-largest crypto exchange, behind Binance and OKEx, according to FTX’s volume tracker.
‘Very late to the game’
SoftBank-backed FTX has been aggressively spending to land an A-list roster of sponsors, including legendary NFL quarterback Tom Brady and his wife Gisele Bundchen, Golden State Warriors guard Stephen Curry, the men’s basketball team of the University of Kentucky and Jacksonville Jaguars quarterback Trevor Lawrence. FTX also now holds the naming rights to the home arena of the Miami Heat as well as the football field at UC Berkeley. As part of a deal with Major League Baseball, umpires wear an FTX patch on their uniforms. Not bad for a company that didn’t even exist three years ago. “A big piece of this is we are trying to get a lot done in a quick period of time,” said Bankman-Fried. “We are really excited about the progress our business has made, but we are also very late to the game.”
Forget cash. Pay me in bitcoinBankman-Fried said FTX is profitable and spends very little on traditional advertising, including on Facebook (FB). “We have a lot of catch-up to do in terms of our branding,” he said.Bankman-Fried did not rule out signing more athletes as sponsors, though he suggested he’s not in a rush to do more deals. FTX declined to say how big of a stake Ohtani will get.”We are really excited to give our partners a stake because it means we are aligned. As much as we are rooting for them on the field, hopefully they are rooting for us to do well in our arena,” he said.
Soaring valuation
Meanwhile, investors are clamoring to get a piece of the company. Last month, FTX raised another $420 million in a funding round that values the company at $25 billion. That’s up from the $18 billion valuation FTX achieved just three months prior. Ohtani’s sponsorship deal calls for him to be an ambassador for both the company’s main exchange and its US-regulated exchange, known as FTX US.
Bitcoin? Ethereum? Dogecoin? Your guide to the biggest names in cryptoThe main exchange offers a greater variety of crypto products than FTX US, including certain derivative and prediction vehicles. Due to regulatory restraints, American investors can only trade using FTX US. Bankman-Fried confirmed FTX is still aiming to acquire a US-based broker dealer that would enable US customers to buy stocks. That would push FTX more squarely into competition with the likes of Robinhood. “It would be a step towards building what we see as a holy grail of a unified financial experience for the consumer,” Bankman-Fried said.
Regulatory hurdles
The Ohtani news comes as bitcoin, ethereum and other coins take a hit amid ongoing concerns about China’s crypto crackdown. Authorities in China blasted bitcoin mining during a press conference on Tuesday as “extremely harmful.”Bankman-Fried said he respects the importance of the news media reporting on the regulatory developments in China, but expressed frustration with the frequency of the headlines around China curtailing the crypto sector.”I do think there is a lot of lazy reporting on it,” he said. “If you take the same story and report on it 30 times, that doesn’t make it 30 times more important. It’s still just one news story.”
The FTX CEO is more hopeful on the US regulatory front and the ability of the crypto industry to work with SEC Chairman Gary Gensler. “They are not trying to regulate crypto out of existence, but they want it to have oversight,” Bankman-Fried said. “In the end, the strongest version of the crypto industry is one that does have regulatory oversight.”
Source: edition.cnn.com