Chelsea reportedly loses $25 million crypto sponsorship deal as FTX's collapse hammers other platforms

• Crypto lender Amber will end its $25 million sponsorship of Chelsea soccer club, Bloomberg reported Friday.
• The move is part of a cost-cutting push at Amber, as FTX's collapse sends crypto companies reeling.
• FTX's bankruptcy could jeopardize its own deals with the Miami Heat and the Mercedes F1 team.

Signs of stress in the crypto sector continue to emerge, as lender Amber Group will terminate its sponsorship agreement with English soccer giants Chelsea, according to a Bloomberg report.

Amber, which was valued at $3 billion in a February fundraising round, will end the deal as part of cost-cutting measures, the Bloomberg report said, citing people familiar with the matter. Its plans include laying off around 300 of the Singapore-based group's 700 members of staff.

In March, Amber agreed to pay 20 million pounds ($25 million) for its flagship crypto exchange WhaleFin to become Chelsea's official sleeve sponsor.

Chelsea is one of English soccer's dominant teams, has won Europe's flagship Champions League twice in the past decade, and is owned by American billionaire Todd Boehly. Christian Pulisic, star of the US men's national team at the ongoing World Cup, is one of the club's players.

Crypto companies are grappling with the fallout from the bankruptcy of major exchange FTX in November, which has undermined faith in the sector. Many businesses are cutting costs in an attempt to ensure their survival.

As the prices of digital asset prices surged last year, digital asset companies sealed sponsorship deals with top sports franchises.

But many of them have bailed on those deals in 2022 in a so-called "crypto winter" for the market, which has seen leading token bitcoin's price crash 63% this year to trade at just over $17,000 on Friday.

FTX itself backed out of a deal to provide jersey patches to the MLB's Los Angeles Angels back in June, according to the New York Post — and sports partners are removing the group's branding after its high-profile bankruptcy.

The Miami Heat basketball team will rename their home stadium, previously known as the FTX Arena, while the Mercedes F1 team suspended their sponsorship deal with Sam Bankman-Fried's company after it filed for bankruptcy.

Amber also sponsors Spanish soccer giants Atlético Madrid, having agreed a 42 million euro ($44 million) deal to be the club's main shirt sponsor for this season.

In addition to the job cuts and cutting the Chelsea deal, Amber will pivot to focus on institutional investors and wealthy individuals, per Bloomberg.

Amber and Chelsea FC didn't immediately respond to Insider's request for comment.

Read more: FTX's rescue by Binance is a red flag for sports heavyweights that signed sponsorship deals with the crypto exchange