Voyager Digital's bankruptcy exposes women's sports to crypto winter

July 08, 2022
Sports Biz

The GIST: Cryptocurrency broker Voyager Digital has declared bankruptcy. The crypto lender filed for Chapter 11 bankruptcy protections in the U.S. on Tuesday, pausing its platform as it restructures operations.

  • Caught in the middle? Several sports parties that struck deals with Voyager, including the NWSL. It’s getting cold in here.

The details: Chapter 11 will protect Voyager from creditors as it rebuilds, and the company has many — it counted over 100K in its filings. It has liabilities to the tune of $1 billion to $10 billion, which must be repaid if the digital broker successfully reboots.

  • Voyager’s current valuation now sits under $50 million — down from $4 billion a year ago — and its shares on the TSX have lost nearly 98% of their value since January. Yikes.
  • Just last week, Voyager ominously halted all withdrawals, deposits and trading, citing “current market conditions.” It’s one of several cryptocurrency brands losing value in the crypto winter.

The sports crossover: Voyager inked a deal with the NWSL in December, becoming one of the league’s largest-ever partnerships. Half of the company’s sponsorship spend was earmarked for a player fund, and the lender planned to provide teams with crypto education and book a player ambassador from each club.

  • The current status of the NWSL’s relationship with Voyager is unclear. On Tuesday, a league spokesperson said it contacted the crypto company and will “monitor the situation.”
  • Other sports deals are also in crypto limbo — Voyager partners with the NBA’s Dallas Mavericks as well as recently retired (again) NFLer Rob Gronkowski and NASCAR racer Landon Cassill.

Zooming out: Though Voyager might not go under, its Chapter 11 filing is a wake-up call to all sports bodies who jumped on the crypto bandwagon — including those accepting digital currency as payment. The news could damage the NWSL and its players, who may have lost access to funds when the platform paused operations last week.

  • The filings may be a warning to women’s sports in particular. Crypto brands recently leaned into female athletes to grow their consumer bases, but well-documented instability should make future stakeholders think twice.
Sports Biz