Riot Games tries to disassociate itself from a sponsorship with FTX, the bankrupt cryptocurrency exchange house; This was for 7 full years, but now it will be difficult for it to be fulfilled.
Riot and FTX signed a sponsorship deal worth tens of millions of dollars in a cryptocurrency exchange in 2021 in which the League of Legends developer would take a pinch.
But now the exchange is bankrupt, its founder arrested and facing serious fraud and money laundering charges; therefore, Riot Games tries to put an end to this catastrophic sponsorship.
As we read thanks to web3’s Molly White is going just great, the deal was to last for 7 years with FTX making “substantial payments” to Riot starting at $12.5 million for calendar year 2022.
This would rise to $12,875 by 2023 and so on, but so far only $6.25 million of it has been paid out in 2022 and there’s almost zero chance Riot will see a penny again.
Therefore, the creators of Valorant or Ruined King have filed a lawsuit with a Delaware Bankruptcy Court to have the rest of the sponsorship agreement annulled.
And in strictly commercial terms it is perfectly understandable since, as Riot points out in its lawsuit, FTX has declared bankruptcy and should recycle the entire agreement and without questions.
Riot and FTX, (un)love making cryptocurrencies
But they add: “There is no way for FTX to fix the reputational damage done to Riot as a result of the public disrepute caused by the debacle that preceded FTX’s bankruptcy filing.
FTX can’t turn back the clock and undo the damage done to Riot after it collapsed.” Basically, that his reputation has been so swept away these weeks that being remotely associated with the failed exchange is hurting Riot.
And (as Kotaku adds) Riot adds that former FTX boss Sam Bankman-Fried became famous for playing League of Legends during business meetings.
Before and throughout this media storm, Riot’s image and reputation with its customer base remained inextricably linked to FTX through its former CEO, Mr. Bankman-Fried.
Media outlets and Twitter commenters spread footage of Mr. Bankman-Fried playing League of Legends – a Riot Games game – at the same time FTX was crashing. Mr. BankmanFried is famous for his affinity for gambling.
He is well known among investors for playing League of Legends during meetings. He acknowledged on Twitter that he played “a lot more [a League of Legends] than you’d expect from someone who routinely trades sleep for work.”
Even Mr. Bankman-Fried’s ranking in League of Legends has been the subject of online commentary with public figures Alexandria Ocasio-Cortez and Elon Musk weighing in.
Even as this deal was first signed in August 2021, it was agonizingly clear what the end goal of this entire scam was going to be: game developers or NBA teams or overly eager celebrities.
At the moment it is not clear if all this is going to come to fruition or if the creators of the also successful Legends of Runeterra continue with the agreement despite everything.
What is clear right now is that Riot is trying to end the catastrophic sponsorship with FTX in every way possible after its bankruptcy.
Hi, its Martin, I am a gamer and a writer. I love exploring games of varied genres and writing blogs about them.