The cryptocurrency exchange FTX, a major sponsor of esports team TSM, has announced it has gone bankrupt and plans to file for Chapter 11.
Massive cryptocurrency exchange platform FTX has filed for bankruptcy, announced in a Press Release on the platform’s Twitter. The FTX Group, consisting of the exchange itself and approximately 130 affiliated companies, announced it was beginning Chapter 11 proceedings in the United States and declaring bankruptcy.
The cryptocurrency exchange FTX, and its many associated businesses in the FTX group, are all filing for bankruptcy in the United States. The platform was a major sponsor of esports organization TSM FTX, promising $210 million over the course of ten years in a naming project that saw the exchange added to the organization’s iconic three-letter name. It didn’t stop there either, with FTX also signing a broadcast deal with the North American franchised League of Legends circuit. The LCS displayed the crypto exchange’s name for the “FTX gold advantage” on the broadcast.
This comes after an incredibly rough month for the cryptocurrency exchange, with its signature native token FTT dropping more than 80% over the course of the month. This dive continued after the announcement of the bankruptcy, down over 30% on the same day. This is a massive blow for the group, and likely a huge financial surprise for TSM and the LCS. FTX going bankrupt is only the latest in a list of unfortunate endings for gaming and cryptocurrency collaborations, but it is certainly the highest-profile collapse of a cryptocurrency esports sponsorship.
Nosediving prices across a variety of cryptocurrencies in recent months were already making the space increasingly volatile. However, FTT’s plunge seems to have been the straw that broke the camel’s back for the massive cryptocurrency enterprise. Exactly how this sudden disappearance in funding will affect the esports space has yet to be seen, with neither TSM FTX nor the LCS making any official comment on the bankruptcy of the sponsor just yet.