FTX, the now-bankrupt cryptocurrency exchange, is looking into the possibility of recovering funds from previously sponsored athletes and teams as part of its swan song. When in operation, the digital crypto platform distributed millions of dollars to individuals, teams, and organisations in the sports industry in exchange for advertising its banner.
FTX investigates possible fund recoveries from sponsored athletes
According to legal documents cited by Bloomberg, experts are trying to determine if all payments were above board. This includes sponsorships to well-knowns such as the NBA’s Shaquille O’Neal and professional tennis player, Naomi Osaka, who received approximately $3.2m from FTX.
The once-prominent cryptocurrency exchange submitted its Chapter 11 filing for bankruptcy in November 2022. FTX founder and CEO, Sam Bankman-Fried, is currently in jail awaiting trial on fraud and other charges in October.
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The sports-based marketing drive involved millions and included franchises such as the Major League Baseball (MLB) and National Basketball Association (NBA). It seems some declarations regarding these funds were incomplete. Even so, the MLB got $4.9m, Mercedes-AMG Petronas, the Formula 1 racing club, $12.2m, and the NBA’s Golden State Warriors $3.4m.
Other sponsorship donations included $2.5m to an O’Neal-based entity of the Authentic Brands Group, forming part of a $4.3m payout to the basketball player and his business. This query comes after a fourth top executive, Ryan Salame, pleaded guilty to criminal charges – a campaign finance law violation – linked to the FTX fraud case against Bankman-Fried.
