TSM sponsor FTX files for bankruptcy following collapse; CEO SBF resigns
The main sponsor of TSM, FTX have today filed for bankruptcy. Bankruptcy papers reveal $10-$50 million in liabilities.
In a press release published today (November 11th 2022) the crypto currency trading company and one of the main (and newest) sponsor for TSM, has announced they are filing for bankruptcy. In a statement, the company announced that they have chosen to go into voluntary bankruptcy along with their 130 additional affiliated companies, with the CEO resigning.
Who are FTX?
FTX also known as FTX Trading Limited are a cryptocurrency exchange and trading company who were first founded in May 2019. The company quickly rose through the ranks to one of the top crypto currency trading companies in the industry and had over 130 affiliated companies. The company moved to sponsor esports organisation TSM in 2021 as part of an unfinished naming rights deal.
The announcement of bankruptcy follows a tumultuous year of cryptocurrency company crashes and has also led to the CEO, Sam Bankman-Fried resigning from his role which will now be filled by John J. Ray III. FTX’s collapse also means a potential collapse for the esports gaming division that the company had launched in partnership with the LCS.
What does this mean for TSM?
As one of the main sponsors for TSM, this likely means that FTX will now no longer have any affiliation with the esports org in any way. However, despite being one of the main sponsors, due to licensing laws, the partnership was not able to be published on the TSM branding in the League of Legends Championship Series. The rules around branding at the LCS prohibited the esports org from changing their name to TSM FTX, though the sponsorship remained.
With this file for bankruptcy, we can safely assume FTX will no longer be sponsoring TSM and will completely withdraw from all elements of the esports org as well as withdraw from the gaming division the company had partaken in.
UPDATE: TSM released a statement regarding the issue. The organization revealed that it had no insight into the matter other than what was reported publicly. "We are currently consulting legal counsel to determine the best next steps to protect our team, staff, fans and players."
TSM ended its message on a positive note, "To be clear, TSM is built on a solid foundation. We are stable and profitable, and we continue to forecast profitability for this year, next year, and beyond. We look forward to a great year in 2023."
What now for FTX?
The collapse of FTX follows the unsuccessful attempted bail out by Binance who was also one of the world’s biggest crypto trading companies. Binance walked away from the deal post due diligence leaving FTX to deal with a mounting set of issues.
The bankruptcy paperwork also unveiled another huge issue for FTX, namely that FTX and Alameda Research have liabilities ranging from $10 billion up to $50 billion. It is currently unclear what the next step is for investors and those involved in the company but the collapse is not a surprise to many who were following this news.
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