What does the FTX controversy mean for the UFC and sponsor Crypto.com?

Following the collapse of Bahamas-based platform FTX last week, users started speculating on the stability of its rival and UFC sponsor, Crypto.com. The fight promotion risks losing $175 million in sponsorship money should Crypto.com find itself in similar waters as its rival FTX.

Users of the platform were worried after the UFC sponsor accidentally transferred $400 million worth of Ether to another cryptocurrency exchange on Sunday. The funds were transferred back to the exchange once the error was recognized.

The CEO of Crypto.com, Kris Marszalek, sought to reassure clients on Monday in an AMA on YouTube.

During the AMA, Marszalek said the following:

"I think everybody agrees that this set back the industry a good couple of years in terms of our reputation, the efforts we put in. 'Trust' was damaged, if not lost. So, in this kind of tumultuous time, what we need to do is focus on rebuilding this 'trust.'"

Marszalek pointed to the fact that his company made the announcement of producing "audited proof of reserves" as a show of transparency, following the collapse of rival FTX.

He also said that transactions were being performed on platform as "business as usual." In regards to deposits, withdrawals and trading on the platform, he said that there was "pretty much normal activity, just at a heightened level."

Crypto.com is the first cryptocurrency exchange to partner with the UFC, doing so in a $175 million deal. The 10-year deal was signed in July 2021 and meant the exchange's logo would be featured on the fighter kits.

The deal was announced by the UFC and the cryptocurrency platform on their respective websites and social media handles.

Crypto.com is also a sponsor of F1 and the FIFA World Cup 2022 in Qatar, among others.

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UFC's fan bonus of the night: Fighters paid in Bitcoin

Earlier this year in April, the premier MMA promotion started paying fighter bonuses in Bitcoin through its partnership with Crypto.com. The bonuses winners were chosen through a fan-voting process.

Bitcoin bonuses included $30,000 for first place, $20,000 for second, and $10,000 for third place.

UFC 273 was the first event to adopt the system. Back then, Khamzat Chimaev was voted in first place, Alexander Volkanovski was voted in second place, and Petr Yan came in third.

However, the fan bonus hasn't been present for the past few PPV events after the voting process came under scrutiny from fans, fighters, and pundits.

In July, No. 14-ranked strawweight contender Luana Pinheiro became the first female sportswoman to receive her salary in Bitcoin. The Latin-American fighter partnered with Bitwage, receiving payments in fiat currency and converting it into Bitcoin immediately through the crypto exchange.