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ARTICLE · 10 MARCH 2022

Cryptocurrency Sponsorships – Balancing Risk vs. Reward

Frankfurt Kurnit Klein & Selz PC
Frankfurt Kurnit Klein & Selz PC
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Frankfurt Kurnit Klein & Selz PC

Frankfurt Kurnit Klein & Selz PC

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Opening new categories of sponsorship allow rights holders to increase revenue and marketing reach – just ask the NFL, which took in $1.8 billion worth of sponsorship deals this...

United StatesTechnology

Opening new categories of sponsorship allow rights holders to increase revenue and marketing reach - just ask the NFL, which took in $1.8 billion worth of sponsorship deals this year while welcoming the categories of sports betting and liquor. Certainly, coming out of two pandemic-troubled seasons in a row, rights holders need to shore up revenue streams. However, moving into emerging categories can pose risk - not only that the sponsors may not be around long enough to fully pay out on the sponsorship agreement, but also reputational risk for the sports property if the sponsor is subject to controversy.

One such emerging category is cryptocurrency. Per GlobalData, over 200 sports sponsorship deals were done by crypto companies in 2021 (up 488% from the prior year) with an annual value of over $600M, with global soccer being the biggest beneficiary.  And while some rights holders have begun to embrace it (for example, the NBA agreed to a 4-year, $192 million deal

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This post first appeared in Frankfurt Kurnit's Focus on the Data blog (www.focusonthedata.com). It provides general coverage of its subject area. We provide it with the understanding that Frankfurt Kurnit Klein & Selz is not engaged herein in rendering legal advice, and shall not be liable for any damages resulting from any error, inaccuracy, or omission. Our attorneys practice law only in jurisdictions in which they are properly authorized to do so. We do not seek to represent clients in other jurisdictions.

Originally published by the New York Legal Ethics Reporter

www.fkks.com

This alert provides general coverage of its subject area. We provide it with the understanding that Frankfurt Kurnit Klein & Selz is not engaged herein in rendering legal advice, and shall not be liable for any damages resulting from any error, inaccuracy, or omission. Our attorneys practice law only in jurisdictions in which they are properly authorized to do so. We do not seek to represent clients in other jurisdictions.

www.fkks.com

This alert provides general coverage of its subject area. We provide it with the understanding that Frankfurt Kurnit Klein & Selz is not engaged herein in rendering legal advice, and shall not be liable for any damages resulting from any error, inaccuracy, or omission. Our attorneys practice law only in jurisdictions in which they are properly authorized to do so. We do not seek to represent clients in other jurisdictions.

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