For those of you who may not know, cryptocurrency is quickly becoming the digital eras preferred method of payment. In layman’s terms, it is a type of digital currency that can be exchanged for goods and services from specific companies and can fluctuate in value depending on the number of people that invest.
However, much like a stock in a company, cryptocurrencies are extremely volatile and has an equal amount of chance skyrocketing as it does in crashing to the ground. This has caused companies like Ethereum to sought out lucrative sponsorship deals with sports teams and brands that can bring them a certain level of stability.
A great example of this in Formula One is Crypto.com who earlier this year, signed a lucrative $100m sponsorship deal with F1, effectively becoming one of its main sponsors. Furthermore, the site is also now the creator of the Crypto.com Overtake Award which awards drivers the amount of overtakes they perform over the course of the season. The site is also a sponsor of Aston Martin and the Formula One Sprint Series.
Unlike Ethereum, the Crypto.com site acts more like a wallet for a multitude of cryptocurrencies, and their involvement in Formula One is mainly to drive existing investors to the site. On the other hand, Ethereum possesses its own cryptocurrency and, much like a stock, putting its logo on the front of a successful Formula One car will hopefully get more people to invest and increase the value of their token.
Outside of Bitcoin itself, Ethereum has quickly become one of the most sought after cryptocurrencies on the market. The company currently sits 2nd on Forbes Top 10 list of Cryptocurrencies with a market cap of over $352 billion and has seen tremendous growth. In October 2020, a single Ethereum token cost $343.58 . In October 2021, that same token costs $3,525.29 , a growth of 816.81%.
It’s this type of return that keeps investors heavily interested in cryptocurrency and if Ethereum is able to close a deal that would make them the sponsor of an F1 team, it’s more than likely that the token could see a spike in value once again.
However, the details of the deal are still speculative. Although a source from the company confirmed that talks were going ahead, all 10 F1 teams refused to speak on the matter, raising a number of questions marks surrounding the validity of the claim. Nevertheless, with smaller cryptocurrency companies such as Tezos, who sponsor Red Bull and McLaren, already on the Formula One grid, teams would be foolish to turn down the aid of a quickly developing company like Ethereum and should take this opportunity to jump further into the 21st century.