Year after ‘Crypto Bowl,’ crypto ads vanish from big game
NEW YORK
How the mighty have fallen.
Cryptocurrency companies grabbed the spotlight during the 2022 Super Bowl, with commercials from a handful of newcomers to advertising’s biggest stage: FTX, Coinbase, Crypto.com and eToro. Some marketing experts dubbed it the “Crypto Bowl.”
A year later, the industry has been humbled by a massive downturn in crypto prices, as well as the bankruptcy of several well-known companies.
The dramatic turnaround harkens back to 2000, when dot-com companies such as Pets.com ran Super Bowl ads, only to go out of business within a year or two.
This year, crypto companies have “zero representation,” said Mark Evans, executive vice president of ad sales for Fox Sports.
Cryptocurrency exchange FTX was one of biggest advertisers in last year’s Super Bowl, featuring ads that included celebrity comedian Larry David. While at the time FTX was the world’s second or third largest crypto exchange, it didn’t operate a large business in the U.S.
Within 10 months of the Super Bowl, FTX was bankrupt. The Bahamas-based company collapsed after investors started pulling their deposits on concerns about the company’s balance sheet. The company filed for Chapter 11 bankruptcy protection on Nov. 11, 2022.
FTX’s founder and CEO Sam Bankman-Fried was arrested and charged with defrauding customers out of billions of dollars. He is scheduled to go on trial in October.
David, along with other celebrities such as football star Tom Brady and basketball star Stephen Curry, was named in a lawsuit that argued their celebrity status made them culpable for promoting the firm’s failed business model.
While Crypto.com still is operating, the company is significantly less healthy than it was a year earlier.
The Singapore-based company announced in January that it was laying off 20 percent of its workforce, on top of layoffs implemented in late 2022. The company also disclosed that a significant part of its assets were tied up in low-quality cryptocurrency coins like the Shiba Inu Coin.
Like FTX, Crypto.com tried to make a name for itself through sports sponsorships. The company spent $700 million for the naming rights to the former Staples Center, where the Los Angeles Lakers play. It’s now the Crypto.com Arena. The company’s 2022 Super Bowl ad featured basketball superstar LeBron James, with the tagline “fortune favors the brave.”
Crypto.com said its layoffs were due to a “confluence of negative economic developments” but its CEO placed a significant amount of blame on the collapse of FTX.
Coinbase had one of the weirder ads at least year’s Super Bowl, involving a floating QR code that would take users to a promotion where the company was giving away millions of dollars’ worth of cryptocurrencies. Marketing experts named it one of the more successful ads of the game, since it took people by surprise and stood out, though many viewers found it confusing.
Shares of publicly traded Coinbase have fallen by more than 70% since last year’s game. With digital currencies such as bitcoin plunging, the company has seen trading revenues dry up as investors have avoided buying crypto altogether.
The company also announced layoffs equal to about 20% of its workforce and the company’s CEO has said the company is bracing for what they are calling “a crypto winter.”
Further, Coinbase has drawn the attention of U.S. regulators. The company had to pay $100 million to settle a New York State investigation into whether it was allowing users to sign up for accounts without adequate background checks. The Securities and Exchange Commission is also looking into whether to ban the cryptocurrency practice of “staking,” which had been big business for Coinbase in the past.