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Scuderia Ferrari, the racing arm of luxury car maker Ferrari, has joined a growing list of F1 racing teams and has ended its partnership with a cryptocurrency sponsor. Ferrari has ended its multi-year partnership deal with Velas Blockchain and chip manufacturing giant Snapdragon, leaving the Italian team with a cumulative loss of $55 million ahead of the 2023 season.
The partnership between Ferrari and Velas from 2021 was set at $30 million annually and aimed to increase fan engagement through non-fungible tokens (NFTs) and other sharing initiatives. However, according to RacingNews365, the team did not comply with the terms allowing Velas to create NFT images of him.
In November 2022, Mercedes also suffered a $15 million loss after suspending its partnership with FTX as the crypto exchange filed for Chapter 11 bankruptcy. Red Bull Racing’s partnership with the Tezos Foundation has suffered a similar fate, as the blockchain company reportedly decided not to renew its contract, citing strategic disagreements.
Toto Wolff, Team Principal and CEO of the Mercedes-AMG Petronas F1 Team, has warned that other teams could run into a similar situation. However, the relationship between F1 and the crypto ecosystem goes beyond partnerships. In October 2022, Formula One filed for the ‘F1’ trademark and revealed plans to launch an online HIS marketplace for cryptocurrencies, Metahis tokens, digital collectibles, virtual collectibles and NFTs.
Related: Argentina’s soccer league acquires Metaverse partnership after World Cup win
Amid the bear market, the Web3 project has taken the lead, strengthening the relationship between fans and sports leagues.
Deloitte’s 2022 Sports Industry Outlook report predicts that the convergence of the physical and digital worlds will accelerate as the market for NFTs and immersive technology grows. As reported by Cointelegraph, the lack of an easy-to-use platform has become the biggest challenge to mainstream adoption.
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