Premier League soccer club Manchester City announced cryptocurrency exchange OKX as a new sponsor and the club’s Official Cryptocurrency Exchange Partner. Through the deal, which extends to City’s men, women and esports’ teams, Manchester City becomes OKX’s first partner in the sports industry.
Manchester City has considerable experience with blockchain-related partnerships. I was one of the first clubs in the Premier League and European football to partner with Animoca for blockchain-based games, launch a fan token with Socios, and celebrate the winning of a trophy with a non-fungible token drop. However, it is far from the first when it comes to cryptocurrency exchange sponsorships.
In November last year, the Premier League started an investigation into ongoing cryptocurrency partnerships and sponsorships with its clubs. It’s concerned these may encourage fans to take financial risks without full awareness of potential consequences. It also mentioned a lack of regulation in the industry and greater opportunities for fraud and misconduct. The UK’s Advertising Standards Authority has banned multiple cryptocurrency exchange advertisements (not OKX) and also a fan token promotion by another club, Arsenal.
Manchester City itself suspended a partnership with cryptocurrency firm 3Key over legitimacy concerns. The club announced the partnership in November with the intent of launching a digital product with 3Key in the coming months. Research showed 3Key had no contact details on its website and failed attempts to contact staff made it hard to prove the business was real. Manchester City stated it would conduct further due diligence, but it discontinued the partnership and any associations with the platform later in the month.
These developments mean Manchester City has every reason to be cautious and thoughtful before associating with any crypto firm.
Still, OKX has a slightly controversial past. In 2019 its fee structure encouraged users to conduct wash trading, which artificially augmented its sale volumes. One of the platform’s directors acknowledged that it happened but stated that the company did not conduct wash trading itself. As of today, OKX ranks second in global crypto volumes, although its website does not rank in the top 30 for crypto exchanges in terms of numbers of visitors.
“The new partnership aligns our shared values of innovation, drive for success and being at the cutting edge of our respective industries,” said Roel De Vries, City’s Chief Operating Officer. “Their broad and inclusive approach to targeting diverse audiences resonates with our approach.”
Despite investigating club associations with cryptocurrency, the Premier League is in discussions with NFT partners, with the rights worth up to $590 million. FC Barcelona is distancing itself from established crypto-related platforms but is planning to launch its own fan token and metaverse.