Atletico Madrid, of Spanish soccer’s top-tier LaLiga, is suing cryptocurrency platform and former shirt sponsor WhaleFin for €20 million in compensation after that firm terminated its contract with the club four years early.
In July last year, Singapore-based Amber Group, the parent company of the WhaleFin app, struck a five-year front-of-shirt deal with Atletico running from the 2022-23 to 2026-27 season worth around €40 million ($43.7 million) per year – representing a major financial boost for the club.
Under that deal, WhaleFin’s logo replaced that of Plus500, the Israel-based online trading platform whose €15 million to €17 million per year deal with the LaLiga side expired at the end of the 2021-22 season.
Amber Group also had exclusive rights to establish “Atletiverse”, a virtual island supported by Openverse, the company’s Web 3.0 enablement platform for creators, brands, and businesses.
However, the contract was terminated earlier this year by Amber Group, which cited the crash in the crypto market for its decision. Atletico then announced Saudi Arabian airline Riyadh Air as its replacement main sponsor and official airline partner in August.
Announcing their 2022-23 financial results, the club said it has not received its initial €40 million sponsorship fee from Amber Group covering the first year of its deal and will enter into arbitration for €20 million in damages over the company’s breach of contract.
In December last year, Amber Group was also forced to end its £20 million ($24.6 million) per-year sleeve sponsorship deal with English Premier League soccer’s Chelsea less than a year after it was signed.
The cryptocurrency crash, which led to the collapse of companies such as FTX, has had a knock-on effect in sports, with several clubs agreeing lucrative sponsorship deals with high-profile platforms in the years leading up to the crash.
Earlier this year, Italian clubs Inter Milan and AS Roma ended their front-of-shirt sponsorship deals with DigitalBits after the firm failed to pay more than €16 million and €11 million to Inter and Roma, respectively.
US sportswear giant NIKE is Atletico’s kit supplier while their training kit partner, meanwhile, is Capital Energy, in a deal running through 2023-24.