The CEO of the Mercedes-AMG Petronas F1 Team and Austrian billionaire Toto Wolff believes that the demise of cryptocurrency exchange FTX could be detrimental to all Formula 1 teams.
The trading platform sponsored Mercedes and had its emblem on the cars driven by George Russell and Lewis Hamilton. However, the squad terminated the contract after learning about FTX’s serious problems in the middle of November.
The massive decline in FTX from last month is still audible in several industries. In a recent interview, Wolff suggested that since all Formula 1 teams have some connection to the cryptocurrency sector, the incident can cause problems for them all:
“Every team has sponsors like that, and the Formula 1 organization as a whole has sponsors like that. Therefore, everyone would be impacted.
The trading location was promoted and an NFT collection for fans was introduced thanks to a sponsorship agreement signed by Mercedes and FTX last year. After noticing its first signs of problems in November, the F1 team initially stood by its partner and swore to preserve the FTX brand on its cars. However, it severed all relations with the exchange just before the latter filed for bankruptcy.
“As a preliminary move, we’ve put our cooperation with FTX on hold. This means that from this weekend, the business will no longer be shown on our race car and other branded assets. We will keep a careful eye on the situation as it changes, said Mercedes.
Prior to its demise, Wolff, who has established himself as a fervent supporter of blockchain technology and cryptocurrencies, said FTX seemed like a “stable corporation.” The “deficit of eight billion dollars” demonstrates the need for appropriate regulations in the business, in his opinion, and its bankruptcy is “a significant damper not only for us but for the entire crypto economy.”
Ferrari, arguably the most successful team in the history of Formula One, teamed up with Velas Network AG, a Swiss technology company, last year to develop NFTs for its followers.
The squad of the current champion, Max Verstappen, Red Bull Racing, and the cryptocurrency exchange Bybit signed a $150 million agreement in February. The location acts as the racing team’s Principal Team Partner, directs its NFT projects, supports fan tokens, and enables financial inclusion for women in the blockchain industry.
Additionally dipping their toes, McLaren Racing teamed up with the cryptocurrency exchange OKX. The latter became the team’s principal sponsor.
As the global partner of Formula 1, CryptoCom’s logo can be seen on every circuit.