"In 2021, FTX will use several dazzling sports marketing to bring Crypto into the public eye."

In December 2020, FTX, which has been established for two years, held an all-hands conference call. CEO Sam Bankman-Fried proposed a new challenge. He asked:"Any big ideas?"In the ensuing brainstorming, FTX really brewed a big enough idea,"How about having our names on a stadium?"

Avi Dabir, vice president of BD at FTX US, who spent a stint in digital media in the NBA a decade ago, said:"I can follow up on this a bit."Three months later, in March 2021, FTX Corporation signed a 19-year, $135 million naming rights agreement, and the home of the Miami Heat was renamed "FTX Stadium."

This signing marks the beginning of FTX's full-scale foray into the sports field. They believe sports is the fastest and most effective route to making FTX a household name. Last year, FTX became the official cryptocurrency trading platform of Major League Baseball (MLB), and the FTX logo can be seen on every MLB referee uniform. FTX also became the official crypto partner of the F1 Mercedes team, the official crypto and NFT partner of the NBA's Washington Wizards and the NHL's Washington Capitals, a deal with the Golden State Warriors, and the NCAA's University of Kentucky Team. In addition, FTX has established direct partnerships with a number of sports stars, including Tom Brady, Steph Curry and recently inducted into the Baseball Hall of Fame Red Sox legend David Ortiz.

To become more recognizable, FTX needs to stand out from the other 300 trading platforms in the market. And in the process, sports can also dispel distrust of the crypto industry."We're not only here to explain what cryptocurrency is, as an investment vehicle, as a technology, to build future applications on top of, why it's the future of financial infrastructure, but we also have to explain to people We are a positive player in this industry."FTX US CEO Brett Harrison said.

"Breakthroughs are very difficult to achieve using traditional means," continued Brett Harrison. “If we just use slow, methodical traditional marketing methods – digital ads, Facebook ads, Google ads, etc., and use these methods to slowly acquire new users, we will never be able to change the public’s prejudice against the crypto industry.”

FTX and the entire cryptocurrency industry face the same hurdles when it comes to acquiring more potential clients and partners. Many previous crypto products were positioned as entertainment, rather than the fundamental key to next-generation banking and investing, and how to shift people's perceptions is critical.

So far, FTX's sports strategy has managed to introduce itself and the industry as a whole to more people, writing a crucial chapter of the cryptocurrency marketing playbook along the way. Martin Conway, a professor of sports business at Georgetown University, said the timing of the introduction of cryptocurrencies to the sports world was quite fortuitous. “With lack of viewers, games being canceled and rights deals locked up, teams have lost tens of millions of dollars, sometimes more,” he said. "It's a perfect storm, the rise of a new industry and an insatiable demand for more money."

FTX’s partnership with the Miami Heat has also led to a flood of other cryptocurrency platforms into the sports market, investing in players, leagues and teams they are interested in. Coinbase becomes a partner of the NBA and WNBA. Binance used NBA star Jimmy Butler to promote its Super Bowl commercial and sponsored the Africa Cup of Nations football match. And of course Crypto.com, which replaced Staples for the naming rights to the Los Angeles Lakers arena. They also signed LeBron James and star-studded Paris Saint-Germain as partners.

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Signed a 19-year exclusive naming rights contract with the NBA Heat

Sports teams and leagues aren't traditional risk takers, especially when it comes to stadium naming rights, because they've learned enough from their past mistakes. Remember the PSINet pitch?

That’s why FTX’s Avi Dabir said that when they talk to partners, the first question they are asked is about the financial viability of the FTX business. “Is cryptocurrency real? Explain blockchain. How did you guys get involved in the cryptocurrency industry?” said Avi Dabir. “In some cases, they’re digging into our numbers. They’re wondering if crypto is just a fad, and there’s a growing realization that crypto is here to stay.”

Michael McCullough, executive vice president and chief marketing officer of the Miami Heat, said that in the first meeting with FTX, it was clear that FTX wanted to raise their flag in a big way, but wasn't entirely sure how to do it. Heat knew that FTX was looking for a partner, not someone who just wanted to cash a big check. "While putting your name on the arena will make you shine, it's just part of the deal," Michael McCullough said. "A big part is about activation. How do we help FTX become a household name? How do we replace the American Airlines legacy that has had our name on our arena since 1999? It's not just in the arena. Put a name on it."

In its debut for sports sponsorship, FTX made a landmark deal with the Heat in Miami. "Naming rights are the highest standard of sports sponsorship," said Georgetown University sports business professor Martin Conway. “They tend to be the most expensive, they’re the flashiest, and they get you that indestructible publicity, and after that, it’s up to you how many customers or engagement you get.”

During the Heat games, events were held in the FTX Arena, both to raise awareness and to improve the image of FTX and cryptocurrencies. “We want to make crypto less scary and more accessible,” said Michael McCullough of the Heat, who speaks on the phone with Dabir and the FTX team every Tuesday. They've had a few campaigns this season, including turning game tickets into NFTs, and launching"encrypted seat", that is, at each home game, 10 seats in the arena are transformed into FTX's brand colors. Those who sit in those seats get $200 in free cryptocurrency, which needs to be activated on FTX’s app. The day after the contest, these promotions had an almost 100% conversion rate, and everyone who took those seats activated their FTX accounts. "Not every promotion in the game will have this effect." Michael McCullough said. “You give someone a free sandwich, not everyone will take it. But with FTX promotions, everyone will participate.”

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Pushing Cryptocurrencies into the Mainstream

As an F1 team, speed is of course very important to Mercedes. But in the field of encryption, they initially wanted to wait and see for a year to a year and a half to see if the wave of encryption would fade, and who were the remaining sticklers in the end. But less than two weeks after voicing the idea, Mercedes' commercial director Richard Sanders said they had to act now or miss out on a big opportunity. Since then, the Mercedes team has been looking for potential partners. “I don’t think anyone would have predicted three years ago that a major sponsorship category for top professional sports organizations would be cryptocurrency businesses,” said Richard Sanders. “If you had told me that then, I would have laughed. But it’s happening now. Part of it is whoever gets the most market share, the fastest, wins.”

When evaluating potential cryptocurrency partners, there are some tricky questions, says Richard Sanders. The decentralized nature of Crypto is not ideal for finding potential partners because you don't know who to turn to when something goes wrong.

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go beyond"big game"Category (BEYOND THE 'BIG GAME')

The surge in sports sponsorship spending has paid off for FTX so far. FTX now has more than 1.2 million users, and its user count has increased by 11,900% in 2021. At the end of January, FTX US raised $400 million in funding, raising its valuation to $8 billion. They capped off their big year in sports with a Super Bowl ad, though no details were released about what it would look like or who might be in it.

Now, FTX isn't leaving anyone in the cold. Looking to the future, Brett Harrison said that FTX's appeal for sports cooperation will not just show its own image, but let its technology appear in these organizations, whether it is NFT tickets or the establishment of payment infrastructure in stadiums, so that users can use Cryptocurrency to buy new jerseys. Avi Dabir said: "At the beginning, we were more like thinking about how to let people know about cryptocurrency. When people know that we are active in this field, we have to change."

After signing with the University of Kentucky men's basketball team, FTX held crypto-related online lectures for the players, and the young people listened with great interest. Some of these players believe that their generation of players and fans is the key to cryptocurrencies entering the mainstream. Avi Dabir: "They accepted very quickly. Maybe there will be some real Crypto natives who will not need to open a bank account and only need a crypto wallet. Why not?"

SBF acknowledged that if one looks at the amount FTX has spent on sports sponsorships over the past year, it is difficult to demonstrate the direct impact on its business. "If you measure it in terms of downloads per dollar of ad spend, it's not pretty," he told Decrypt's podcast in January. But he thinks sports drives something else, "in terms of changing people's perception of us. In other words, it goes deeper than everything else we do."

Brett Harrison, however, is more optimistic. At the beginning of 2021, FTX was processing about $1 million in transactions per day. By November 2021, that figure will reach $400 million. Brett Harrison said: "Behind this explosive growth is our ability to break through the institutional inertia of existing large partners such as Coinbase or Kraken, as well as the marketing cooperation established with new partners."