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Nationals in awkward position with Terra crypto sponsorship amid coin's decline

Terra sponsors premium area at Nationals Park, but few fans at a recent home game knew much about the cryptocurrencyNationals

The Nationals' Terra Club behind home plate may be the "biggest embarrassment for the club right now" as the cryptocurrency has lost billions of dollars in value "after the platform's algorithmic stablecoin lost its peg to the dollar," according to Michael Regan of BLOOMBERG NEWS. It appears that Terra has received "not much" out of the five-year, $40M deal with the Nats. Few fans at a recent Nationals game "knew much about Terra." It is "highly doubtful that Washington was selected at random" by Terra Founder & CEO Do Kwon, who is "entangled in a legal dispute" with the SEC. He described the partnership -- which also involves the Nats tweeting Terra-branded videos -- as a "way to engage and educate the public, including the policy makers doing important work in Washington, D.C., about decentralized money." The Nationals were "expected to start accepting Terra's stablecoin for payments next season, part of Kwon's longstanding goal that the token be used in real-world transactions." With the coin now trading for less than $0.09 rather than $1, that "seems unlikely" (BLOOMBERG NEWS, 5/19). 

TIME TO REASSESS? THE ATHLETIC's Kaplan & Shea wonder whether athletes, teams and leagues should be "encouraging fans to buy in" to unregulated assets like cryptocurrency. The concern critics have is "not that teams and leagues will see sponsorships collapse but that the sports entities are encouraging fans to invest in a risky, unregulated market." But not everyone "sees an issue with the promotion of crypto in sports." Many athletes and teams "got into crypto because it's advertised as the future of money." It is viewed as the "cool thing, with Tom Brady backing crypto exchange FTX in funny commercials and Steph Curry and Trevor Lawrence also backers, while Joe Burrow hypes Bitcoin." Crypto enthusiast and Mavericks Owner Mark Cuban "doesn't see an issue." Cuban in an email wrote, "Look at the stock market. Facebook, Amazon and Apple have lost more in market cap than the entire crypto market. A ton of tech companies have lost 80 percent or more of their value. I don't see anyone questioning sponsorships by those companies." The difference is those companies "advertise to get consumers to buy or use their products." If their stock falls and the sponsorship goes away, it "does not affect the fan who bought the underlying product." Crypto sponsorships and endorsements are different in that they are "seeking fans to put their money at risk" (THEATHLETIC.com, 5/20).

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