The Argentinian Football Association (AFA) has disputed Binance's claims that it violated the terms of the agreement in a sports sponsorship deal with the cryptocurrency exchange. The association is reportedly planning to take the matter to court.
According to a report by the media publication SportBusiness, the AFA claims that Binance terminated the deal abruptly due to the financial and regulatory challenges facing theexchange. Binance and its US affiliate, Binance.US, were sued by the Securities and Exchange Commission (SEC) for allegedly violating federal securities laws.
Binance-AFA Sponsorship Deal
Binance signed the sport sponsorship deal with the AFA in 2022. In the deal, worth an estimated USD8 million per year, the exchange was named the main sponsor of the reigning world champions. However, the deal was not without controversy after Socios, a fan token site, sued the association for terminating its existing contract and signing a similar contract with Binance.
In a statement translated from Spanish, Binance said: "We regularly evaluate the results of our sport sponsorships throughout the world and unfortunately, despite being offered time and opportunity, the AFA has not fully complied with its contractual obligations, which goes against our business values and our partnership principles."
Binance ha decidido poner fin a su asociación con la AFA (Asociación del Fútbol Argentino). Regularmente, evaluamos los resultados de nuestras alianzas en todo el mundo y, lamentablemente, a pesar de que se han ofrecido tiempo y oportunidades, la AFA no ha cumplido plenamente con…
— Binance Argentina (@BinanceArg) July 17, 2023
However, the AFA's President, Pablo Toviggino, has disputed the claims citing the challenges Binance is currently facing, including the recent announcement of staff layoffs. Finance Magnates reported four days ago, citing the Wall Street Journal, that Binance had laid off 1000 staff from its global workforce of 8,000 employees.
Citing Staff Layoffs
The staff layoff was preceded by the exit of senior executives at Binance. In a separate report by Finance Magnates, Patrick Hillmann, Binance's Chief Strategy Officer, was among the top executives who quit their roles at the exchange. However, Binance's CEO, Changpeng Zhao dismissed concerns about the departures as nothing unusual.
"As markets and the global environment for crypto exchanges, as our organizations evolve, and as personal situations change, there is turnover in every company," Zhao said. "We thank our ex-team members for their contributions to our growth and wish them all the best."
Binance has entered into several other sport sponsorship agreements with football clubs, including Lazio, which lists the exchange as a premium partner. Additionally, Binance is the sponsor of the Brazilian top-ranking football league.
This article was written by Jared Kirui at www.financemagnates.com.
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