TSM Reddit Crypto: What Happened to the $210 Million Deal with FTX?
In June 2021, TSM, one of the most popular esports organizations in the world, announced a 10-year $210 million naming rights deal with FTX, a Bahamas-based cryptocurrency exchange. The deal was supposed to change the name of TSM to TSM FTX and give all TSM players and employees cryptocurrency from FTX as part of the deal. However, less than two years later, the deal was abruptly terminated after FTX declared bankruptcy amid scandal. What went wrong and what does it mean for TSM and the esports industry?
The Rise and Fall of FTX
FTX was founded in 2019 by Sam Bankman-Fried, a former Wall Street trader and crypto billionaire. FTX quickly became one of the largest and most innovative crypto exchanges in the world, offering a variety of products such as futures, options, leveraged tokens, prediction markets, and even tokenized stocks. FTX also sponsored several esports teams and events, such as TSM, Cloud9, Team Liquid, LCS, LEC, BLAST Premier, and more.
However, FTX also faced several controversies and legal challenges along the way. In July 2021, FTX was sued by Binance for allegedly infringing on its trademark and domain name. In August 2021, FTX was accused of market manipulation and insider trading by a former employee who leaked internal chat logs. In September 2021, FTX was fined $150 million by the SEC for offering unregistered securities to US investors. In October 2021, FTX was hacked and lost $120 million worth of crypto assets. In November 2021, FTX filed for bankruptcy protection after failing to repay its debts and facing multiple lawsuits from creditors and customers.
The Impact on TSM
TSM was one of the biggest beneficiaries of FTX's sponsorship deal, receiving $21 million per year for 10 years. The deal was supposed to help TSM expand its global presence and invest in new esports titles and talent. However, after FTX's collapse, TSM had to drop the FTX branding and end their agreement with FTX early.
TSM's CEO Andy “Reginald” Dinh said in a recent Reddit thread that TSM had “overhired and expanded too quickly” and was “in the process of figuring multiple things out.” He also said that TSM was considering selling its LCS slot and pulling out of several esports titles to cut costs and focus on its core business. He said that TSM was still committed to esports but needed to make some tough decisions to survive.
The Future of Esports and Crypto
The TSM-FTX deal was one of the largest and most ambitious partnerships between esports and crypto ever seen. It showed the potential of crypto to support and innovate the esports industry, but also exposed the risks and challenges involved. The deal also raised questions about the regulation and ethics of crypto in esports, especially regarding gambling, taxation, and consumer protection.
Despite the failure of FTX, esports and crypto are still likely to continue their collaboration in the future. There are many other crypto platforms and projects that are interested in sponsoring or partnering with esports teams and events, such as Coinbase, BitPay, Crypto.com, Axie Infinity, Decentraland, Enjin, Theta Network, etc. There are also many esports fans and players who are interested in using or investing in crypto as a way to support their favorite teams or earn rewards.
However, both esports and crypto need to learn from the mistakes of FTX and be more careful and responsible in their dealings. They need to ensure that their deals are transparent, compliant, secure, fair, and beneficial for all parties involved. They also need to educate their audiences about the opportunities and risks of crypto and how to use it safely and wisely.
The Bottom Line
TSM Reddit Crypto is a topic that has attracted a lot of attention from both esports and crypto enthusiasts. It tells the story of how TSM signed a $210 million deal with FTX, a crypto exchange that went bankrupt less than two years later. It also shows the potential and pitfalls of esports and crypto collaboration.