Bybit, one of the top ten crypto exchanges by spot volume, has signed a huge sponsorship deal with Formula One team Oracle Red Bull Racing, with the exchange now serving as the racing team’s “Issuance Partner” for fan tokens and non-fungible tokens (NFTs).
The arrangement, at USD 50 million per year for three years and totaling USD 150 million, is the highest sponsorship agreement for any crypto firm in sports on a per-year basis.
It is followed by Crypto.com’s sponsorship of the former Staples Center in Los Angeles, now known as Crypto.com Arena. That transaction is valued at USD 35 million per year, but the overall value over the 20-year term is far greater, at USD 700 million.
Bybit and Oracle Red Bull Racing have agreed that the exchange will become a Principal Team Partner of the racing team, as well as a Tech Incubator Partner and a Fan Token Issuance Partner.
In terms of token issuance, Bybit will assist Oracle Red Bull Racing in distributing “its burgeoning digital asset collections,” according to a Bybit release. It went on to say that “NFT activations” and “social tokens” are part of the strategy, but did not elaborate.
According to the release, the USD 50 million yearly sponsorship price would be paid in cash and BIT tokens. BitDAO, Bybit’s investment-focused decentralized autonomous organization (DAO), uses BIT as its governance token.
Old Sponsorships
The new sponsorship agreement is not the first time a crypto-native firm has entered Formula 1 to assist with the issue of so-called fan tokens, which some anticipate will become an increasingly vital method for sports teams of all types to make cash.
McLaren Racing signed a long-term sponsorship agreement with the Turkish crypto exchange Bitci.com in June, which featured the launch of NFTs and a fan token.
However, according to a Bloomberg article published a few days ago, the sponsorship arrangement has now been discontinued, with no explanation offered and no indication of the future of the fan token.
The termination came as it was revealed last week that a planned Bitci.com fan token for Premier League football side Wolverhampton Wanderers had failed to be provided despite the agreement being inked in June.
The team is still conducting due diligence, according to unidentified people “familiar with the topic,” which is why the tokens have not yet been released.
