- Manchester City halted its deal with 3Key after the crypto platform's thin online presence raised questions.
- Fellow soccer giant FC Barcelona cancelled its own marketing deal with NFT marketplace Ownix last week.
- Crypto companies have flocked to pro sports teams to build awareness and credibility via partnerships.
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Soccer giant Manchester City has pulled back from its partnership with obscure crypto startup 3Key, in a development that underlines the risks for pro sports teams as crypto companies pursue them for marketing deals.
The football club, which topped the UK's Premier League last season, decided to suspend its deal with 3Key after questions arose about a lack of information about the decentralized finance company, media reports said Friday.
Last Monday, Manchester City and 3Key announced on Twitter that they had signed a deal to make the DeFi trading analysis and advisory platform an official regional partner of the team.
The club said in a now-deleted online statement that it was "excited to partner with 3Key in their journey to simplify the decentralised finance (DeFi) trading analysis user experience through the power of football to engage with our fans with a range of content and activations."
But it wasn't clear which region was involved, and investigations by a crowd of internet sleuths failed to find a location or significant online presence for 3Key, the Guardian reported last week. Two of the company's websites went offline on Tuesday, but one has since returned.
A hunt for some executives named on its press release did not discover any digital footprint for them, nor for Ryan S Hodder, 3Key's chief marketing officer cited in Manchester City's announcement, the report said.
In the wake of the reports, the English football club got cold feet about the deal, going by a statement posted to Twitter by Daily Mail reporter Jack Gaughan on Friday.
"Prompted by the club's interactions with 3Key Technologies in recent days, Manchester City is now conducting further enquiries regarding 3Key Technologies and the partnership has been suspended pending satisfactory resolution to all of those inquiries," it said in the statement.
The UEFA Champions League contender said it "conducts due diligence" for all its partnerships, and it noted that the deal with 3Key had been announced, but not activated. The club did not respond to a request for comment from Insider.
Manchester City is not the only one to be treading the crypto path carefully. Fellow soccer giant FC Barcelona on Thursday cancelled its own marketing deal with Ownix, a marketplace for non-fungible tokens (NFTs). The partnership enabled Barcelona fans to buy NFTs of items linked to the teams history.
The Spanish soccer giant said it nixed the partnership "in light of information received today that goes against the club's values." It did not respond to a request for comment from Insider.
The move comes after Ownix-linked businessman Moshe Hogeg was arrested for fraud linked to cryptocurrency, the Associated Press reported. Hogeg denies all allegations against him, his lawyers told the Times of Israel.
Ownix denied it had anything to do with these matters in a Twitter post on Friday, and said it was terminating its consulting agreement with Hogeg.
Cash-rich crypto companies have flocked to professional sports teams for sponsorship and marketing deals, as regulators and businesses crack down on crypto advertising.
Recently, the operator of Los Angeles' Staples Center sports venue — home to the Lakers, Clippers, Kings and Sparks — said the sports venue will be renamed Crypto.com Arena after striking a deal with the Singapore-based crypto platform.
And in an aggressive marketing campaign, Sam Bankman-Fried's exchange FTX snapped up naming rights for the Miami Heat's stadium in a $135 million deal, and bought an ad for the 2022 Super Bowl.
