In the midst of a possible bankruptcy by FTXand an impending investigation by the US Securities and Exchange Commission into alleged misuse of customer deposits, Mercedes has responded overnight to the changing situation.
Although it initially seemed likely that it would keep the FTX logos on its cars for the Interlagos weekend, a Mercedes spokesman confirmed to motorsport.com on Friday morning in Brazil that the team had terminated the agreement.
“As a first step, we have suspended our partnership agreement with FTX,” the Mercedes spokesman said.
“This means that the company will no longer appear on our race cars and other brand assets from this weekend. We will continue to monitor the situation closely as it evolves.”
Lewis Hamilton, Mercedes W13
Photo by: Mark Sutton / Motorsport Images
FTX is on the verge of bankruptcy after being plunged into a liquidity crisis that erupted in its affiliate company Alameda Research this week.
FTX is believed to be facing an $8 billion hole in its finances, which will need to be plugged if the company has any hope of moving forward.
An initial plan for its rescue by rival Binance, which is a sponsor of the team Alpinecrashed earlier this week, causing a crash in the cryptocurrency markets.
The near collapse of FTX has prompted a response from US authorities, with widespread reports suggesting the country’s Securities and Exchange Commission will investigate whether or not there was any criminal activity in the way FTX handled customer deposits.
Amid an uncertain future for FTX, questions have been raised about a wide range of sponsorship deals the company launched in recent years, including in F1.
In addition to the original multi-year deal it signed with Mercedes at the end of 2021, FTX has agreed to a $135 million deal for the stadium where the team plays Miami Heat of the NBA will be renamed FTX Arena until 2040. FTX is also the official cryptocurrency brand of the Major League of baseball.
At this year’s Grand Prix of Miami, FTX had a major presence through an event called Off the Grid, in South Beach, which included live music and exhibitions with Mercedes single-seaters.
There has been a flood of crypto sponsors in F1 in recent years, raising concerns about whether teams were taking risks by being tied to such a volatile industry.
Earlier this season, Mercedes boss, toto wolffsaid it would have been a mistake on the part of the sport to turn its back on the opportunities offered by the crypto world.
“You can’t close yourself off from modern technology,” he said. “It’s definitely an area that will grow.”
“When we’re looking back 10 years from now, having to make payments that take two days and can’t be done outside of the week is going to be a relic of the past. And this is where crypto comes in.” .
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