FTX file for Bankruptcy Protection, leaves organizations like TSM in huge turmoil

FTX file for Bankruptcy Protection, leaves organizations like TSM in huge turmoil

TSM FTX logo

TSM was left in a tricky situation after its naming rights partner FTX filed for protection under the USA Bankruptcy Protection Scheme on 11th November 2022. The ex-CEO of the crypto-trading organization, Sam Bankman-Fried apologized in public stating, ‘“I’m really sorry, again, that we ended up here. Hopefully, things can find a way to recover. Hopefully, this can bring some amount of transparency, trust, and governance to them.”

However, this has left the collaboration between TSM and FTX in a tricky situation, since FTX still has the naming rights of the Valorant Outfit. With a lack of finances, it appears that the outfit would not be able to expand its roster and bring in new players within its squad. When announcing the partnership with FTX in June 2021, TSM said that it would invest resources “into esports and gaming over the next five years”. One of the organization’s targets was to “accelerate existing global reach” by opening several offices across the planet, including in Asia, Europe, and South America, the plans of which appear to have come to a standstill.

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TSM has since then refused to comment on the entire scenario, especially after announcing that the organization would return to CS: GO in 2023, and the overall idea of the organization was the creation of “a strong footprint within Europe“. It remains to be found out if TSM’s expansion plans are still viable given the present situation of FTX, and how this Valorant outfit would react to this incident.

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TSM FTX bankruptcy: What do we know about it?

TSM FTX
TSM FTX

TSM had initially planned to use the funds acquired from the FTX sponsorship to attract star players with better salaries to move up their playing roster, add teams in more esports leagues such as CS: GO, Overwatch, and Rainbow Six Seize and open offices in areas like China, Europe, and South America. The original deal signed last year saw FTX US partner with TSM in relation to the U.S. market while FTX.com partnered with the team internationally.

FTX’s chances of surviving its bankruptcy situation took a turn for the worse as Binance, the world’s largest crypto-exchange company that had initially signed a non-binding deal to acquire FTX, eventually pulled out. Now TSM, along with those that have partnership deals with FTX such as the Heat (arena naming rights), MLB (including umpire patches), and the Mercedes-AMG Petronas racing team in F1, are left without sponsorship revenue.

This is not however that something like this has happened in esports, as Crypto.com had signed a deal to be the global crypto partner of the Twitch Rivals esports league. However, Crypto.com leadership decided earlier this year to end the pact. Both companies have since then agreed to dissolve the deal by the end of 2022. It will be interesting to find out if TSM and FTX decided to take a similar approach.

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