Luxury car maker Ferrari’s racing division, Scuderia Ferrari, has become the latest Formula One Racing team to end a partnership with a cryptocurrency sponsor. The agreement, which began in 2021 at $30 million per year, was terminated due to misalignment of strategy. The 2023 season is quickly approaching.
The Ferrari-Velas partnership was designed to increase fan engagement by using non-fungible tokens, NFTs, and other sharing programs. However, the team failed to adhere to the provisions that enable Velas Racing to create NFT images. This move follows similar decisions made by other F1 teams, such as Mercedes and Red Bull Racing.
Toto Wolff, CEO and team principal of the Mercedes-AMG Petronas F1 team, warned that other teams may find themselves in similar scenarios. The relationship between Formula One and the crypto ecosystem is more than just partnerships. In October 2022, Formula One revealed plans for an online marketplace that will sell cryptocurrencies, digital collectibles, and NFTs.
Organizations like Web3 projects have taken the initiative to strengthen engagement between sports leagues and fans, even during a bear market. A report by Deloitte entitled “2022 Sports Industry Outlook” projected a surge in the blending between the digital and real worlds, as well as growing markets for NFTs and immersive technologies. However, Cointelegraph reported that the greatest obstacle to widespread adoption is the lack of user-friendly platforms.