Cryptocurrency is becoming more and more prominent in sport, with multiple teams on the F1 grid now sponsored by crypto companies.
Mercedes have been sponsored by FTX in recent years, however the company filed for bankruptcy in recent weeks, despite the firm looking like a stable and successful platform to the outside world.
The Silver Arrows were forced to remove any branding of the cryptocurrency exchange company from their cars and race suits ahead of the Brazilian Grand Prix, which was won by George Russell, following the announcement that the company would be going under.
Team principal Toto Wolff has now called for crypto’s involvement in Formula 1 to be more tightly regulated, with it being unbelievable and unacceptable that a sponsor of an F1 team can go bankrupt at the blink of an eye.
“It’s difficult, because we all know that crypto has relevance,” Wolff said.
“I strongly believe in blockchain as a way of transactions in the future, but the situation is very unfortunate.
“We considered FTX because they were one of the most credible and solid, financially sound partners that were out there, and out of nowhere, you can see that a crypto company can basically be on its knee and gone in one week, and that shows how vunerable the sector still is,” continued the Austrian.
“It’s unregulated, and I believe it needs to find its way into regulations, because there’s so many customers, investors, partners like us that have been left in utter disbelief [as to] what has happened.”
Wolff’s comments will come as warning for many other teams in the paddock that reply on sponsorships from crypto companies, such as Red Bull who signed a record breaking deal with Bybit at the start of the season.
Crypto.com are a corporate sponsor of F1 and hold the naming rights for the sprint races, of which there will be six next season, showing that crypto has a strong influence on the sport regardless of its instability.
Losing a sponsor will come as bad news for Mercedes, who will be looking to make use of every available penny in their hunt to return to the top of Formula 1, taking advantage of the opportunity presented to them by Red Bull’s cost cap breach punishment.