The renowned Spanish football club Atletico Madrid is reportedly gearing up to take legal action against WhaleFin, a Singapore-based cryptocurrency exchange.
The dispute centers around a breach of contract involving unpaid sponsorship fees amounting to €40 million ($44 million).
Atletico Madrid, the esteemed Spanish football club, is preparing for a legal battle with WhaleFin, a Singaporean cryptocurrency exchange, over a €40 million unpaid sponsorship deal.
The club, which entered a five-year agreement with WhaleFin for the 2022/23 season, claims the company has breached the contract terms by not fulfilling payment obligations. In response, Atletico Madrid is seeking €20 million in damages.
The backdrop to this legal challenge involves the financial struggles faced by Amber Group, the owner of WhaleFin. Reports from December 2022 highlighted Amber Group’s difficulties, leading to the termination of a similar sponsorship deal with the English Premier League’s Chelsea FC, valued at $25 million annually, just seven months into the agreement.
During that period, the Singapore-based cryptocurrency trading firm made the decision to downsize its workforce by approximately 300 employees. It had also started winding down its retail operations, further emphasizing its financial challenges.
The situation with Atletico Madrid bears similarities to issues faced by other European football clubs in their dealings with cryptocurrency firms.
Inter Milan and Roma, prominent Italian clubs, experienced similar sponsorship failures with the blockchain company DigitalBits. The two clubs had to sever ties with DigitalBits after it failed to pay over €27 million ($30 million) combined in sponsorship fees.
Roma’s dealings with DigitalBits began with a three-year shirt sponsorship agreement with Zytara Labs in July 2021. Inter Milan signed a four-year contract for sleeve sponsorship rights, which were later upgraded to front-of-shirt rights for the 2022-23 season.
However, Inter Milan disclosed problems with the partnership as early as October last year, leading to it seeking a new shirt sponsor. By March, it was revealed that Inter had not received any payments for the season from DigitalBits, despite an agreement worth €85 million.
Consequently, Inter Milan and Roma removed the DigitalBits logo from their shirts due to continued payment failures.