Like most others, I first learned about Crypto.com when Matt Damon called me a coward on my television. I’ve been following cryptocurrencies for more than ten years, but I’ve never invested in them since, other from money laundering, I’ve never been able to see their usefulness. But once I saw Damon, I realised that the public’s opinion of the technology had changed. And yeah, I did feel like I may get lost.
The advertisement with Damon is a component of Crypto.com’s bigger, sports-oriented marketing campaign: The NHL’s ice, the UFC’s octagon, and the Philadelphia 76ers’ uniforms all include the lion-head emblem of the Bitcoin exchange. LeBron James appeared in an advertising for Crypto.com during this year’s Super Bowl. The firm revealed last November that it has paid $700 million for the naming rights to the Los Angeles Lakers’ downtown stadium. It made a sponsorship announcement for the World Cup in March.
The push seemed great during the time when cryptocurrency was surging, if not a little annoying. However, the incident happened in the second week of May of this year, and Damon’s name began to trend on Twitter.
Commentators noted that anybody who had invested in Bitcoin on the day that Damon’s Crypto.com advertisement initially aired had lost half of their money. One said, “There’s a sucker Bourne every minute.”
In light of the issue, it is important to consider what Crypto.com really is and aspires to be. In its present form, Crypto.com makes the majority of its revenue by using its mobile app to execute transactions for customers. (The business targets small investors, and some individuals I spoke with likened it to the investment software Robinhood.) The business of charging commissions to exchange bitcoins is successful.
A marketing arms race has resulted from the competition between rival exchanges like FTX and Coinbase for the same users. The Miami Heat’s arena is named after FTX, and Coinbase, the NBA’s only cryptocurrency platform partner, went public last year and reported greater profit margins than Google. You will see advertisements for all three companies on the same broadcast if the 76ers visit Miami for a nationally aired game.
I believed that Crypto.com was only distributing money after each subsequent encounter. And it was—but to my surprise, Crypto.com is often not the top bidder when it comes to sponsorship arrangements.
CEO of Crypto.com Kris Marszalek stated, “The capacity to write a check is a nice beginning point to many a discussion, but for those truly essential things, the ones that have actual consequence, it’s never enough.” Marszalek, a 42-year-old serial entrepreneur of Polish descent, resides in Hong Kong. He has a monotone voice and wears branded zip-up sweatshirts and neutral suit jackets as part of his preferred business attire.
His big forehead, which is what makes him stand out, is framed by a thinning hairline above and a pair of tiny, rimless spectacles below. I anticipated a snake charmer given the scope of Marszalek’s marketing efforts and the rapid appearance of Crypto.com as a participant among the exchanges. I really received the repairman for your printer.
However, Marszalek’s lack of spark hides a keen comprehension of what drives people. He commissioned an advertising campaign, which helped Crypto.com overtake rivals and gain more than 50 million users. Nobody had ever heard of Crypto.com 18 months ago when it first launched under a different name and with a different business model. Even in today’s collapsing economy, the underdog could succeed.
I chatted with Marszalek multiple times in March and April while covering this article. After the accident last week, I chatted with him once again through Zoom to get his perspective. He is urging his clients to look beyond the decline. “I would want to remind everyone that after this week’s sell-down, those who purchased at the extreme top in 2017 at the cycle’s high are up more than 50%, okay? Thus, this is the market’s cyclical character.
Whatever your opinion on Crypto.com, Marszalek deserves credit for one thing: the man is a bloody iceman. I wanted to do a Voight-Kampff test on him because of how emotionless his response to the collision was. He credited his experiences during the last 2018 meltdown, during which Bitcoin dropped 78% of its value, for his perseverance.
“This is really a tremendous improvement,” he added, “if I compare the sort of storylines and coverage that we’re receiving as an industry right now versus 2018.” I saw that many of his clients were now discouraged and dissatisfied.
“A significant portion of the people that entered the market will disconnect for a period, and they’ll be less active,” he said. “However, I’ve also seen individuals reawaken when the cycle kicks up again, which it will unavoidably do.”
Whoever establishes themselves as the go-to cryptocurrency exchange will have unmatched power over our developing currencies. As a result, the exchanges are making an effort to draw users to their systems. Many are providing high-yield accounts with cryptocurrency payouts for profits. Customers of Crypto.com are rewarded with interest rates of up to 14.5 percent annually for accounts with sufficient money as well as up to 10 percent annually in “stablecoin” currencies tethered to the dollar.
This destroys a savings account that pays almost nothing and raises concerns about the potential risks such platforms may be taking. The financial author Raymond DeVoe Jr. once said, “More money has been wasted striving for yield than at the point of a pistol.” This got me to thinking about that.
One of the causes of the present crisis was that overreach. Late last year, a coin called Luna rose to become one of the most valuable cryptocurrencies in the world as a result of its connection to Terra, a currency that its business had produced and which investors could lend for interest payments of around 20%. However, when the Terra-Luna alliance broke down in May, Luna crashed and its value dropped by 99.99%.
Moderators put the National Suicide Prevention Lifeline’s phone number to the top of the TerraLuna subreddit after the wipeout.
People stop trading cryptocurrencies when their value declines, as it has mostly done recently. That causes the exchanges’ revenues and marketing budgets to be compressed. Marszalek was planning for a bear market even during prosperous times.
In April, he said, “We got through the crypto winter of 2018 and 2019.” “We continued to work diligently on creating a solid product. Marszalek wants Crypto.com to be more than an exchange; he wants it to be a “ecosystem”.
Crypto.com started out marketing prepaid crypto-linked debit cards, which it still does, and it also runs its own cryptocurrency called Cronos, which it invites users to “stake” (i.e., lock money into) in exchange for various rewards.one That’s of the reasons why we grew so quickly in 2021. Marszalek loves to keep things adaptable, so in March of last year he launched a market for NFTs. Right present, trading accounts for 90% of industry income, am I correct? He said, ” If it is still the case after three years, the industry as a whole has failed miserably.
Deals involving names play a significant role in Goldstein’s working life. (We met in the Lexus Club, located inside the Crypto.com Arena and next to the Xbox Plaza.) AEG received $700 million over 20 years as part of the agreement he assisted in negotiating with Crypto.com, although Goldstein informed me that AEG was not the top bidder. Other businesses had made us better offers, he said. Interestingly, since we publicised the agreement, I’ve had businesses offer us more money, even a takeover.
Goldstein declined to accept that buyout. You need a partner that won’t simply be interested in making a huge impression in the first year, but will be deliberate over the course of the following 20 years, he said. I emphasised that Crypto.com was just a few years old and that over those two years, the business had gone by a different name. They were very wise and intelligent.
The interaction we had was the most genuine and natural one, according to Goldstein. “However, I can assure you that we wouldn’t have completed the transaction as Monaco. We wouldn’t now be in the Monaco Arena. (After the accident, Goldstein stayed dedicated. This deal is for 20 years, and we consider the category as a whole, he said.)
How was Marszalek doing it? Definitely not via stage presence. He talked quietly throughout our talks, and sometimes he would take a long time to respond when I asked him a question while he was staring at the ground. He stared at the ground so intently at one part of our talk that I assumed his Zoom had malfunctioned. (Matt David subsequently said to me, “I apologise for not telling you about the extended gaps.
I usually do a great job of cautioning folks against things. However, when Marszalek did react, it was always polite and sometimes almost impenetrable, as if he had been merely honing it in the mental rock tumbler.
Regarding his remarkable run of marketing partnerships, Marszalek remarked, “There has been a lot of grit, perseverance, and ingenuity, but the capacity to listen has also been extremely essential.”
In order to better comprehend the other person’s anticipated places of mental resistance and address them, Marszalek informed me that he loves to put himself in their position. What issue is being raised on the opposite side of the table, please pay close attention?
Wanting to see things from the cetacean perspective, I wrote to Mark Cuban, owner of the Dallas Mavericks and noted crypto whale. Cuban made his fortune selling the overvalued Broadcast.com to Yahoo in 1999, then famously traded options on his Yahoo stock as a hedge against his windfall.
It was the trade of a lifetime, especially after the bubble burst, but he doesn’t see a parallel with crypto. “Most of the apps like Crypto.com are centralized exchanges that are actually very profitable,” Cuban said in an email.
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He contended that sports-stadium operators will accept below-market rates for sponsorship “because they see these companies can grow significantly, which means there are future opportunities.” The possibility of a crash was always present, as Cuban knew better than anyone, but for now, he remains bullish.
Last October, the Mavericks signed a sponsorship deal with the crypto trading platform Voyager, and in January, Cuban told Jon Stewart that 80 percent of his new investments outside of Shark Tank are in the crypto space