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Saturday, Apr 01, 2023

Welcome to the crypto Super Bowl

Welcome to the crypto Super Bowl

The priciest Super Bowl commercials will cost a record $7 million this year, according to NBC. To put that into terms many of the big game's advertisers will understand, that's about 160 bitcoin or 2,200 ether.

Cryptocurrencies will be taking center stage during the ad breaks of Super Bowl LVI, even as bitcoin prices have tumbled more than 35% from their all-time highs just a few months ago.

FTX, a crypto exchange that recently raised funding valuing it at $32 billion, has had the now retired seven-time Super Bowl champ Tom Brady appear in its previous spots and will run an ad during Sunday's game. (Brady and his wife, Gisele Bündchen, also own a stake in FTX.)

The company wouldn't disclose if Brady or any other celebrities would be in its ad, but it is promising to give away bitcoins as part of the promotion.

Crypto.com, a cryptocurrency exchange that has used actor Matt Damon in its commercials, confirmed to CNN Business that it also will have an ad. The company wouldn't say if Damon will appear in the Super Bowl spot.

Social media gives crypto firms anther way to do Super Bowl ads

Binance, another crypto exchange, has been doing a lot of social media advertising leading up to the Super Bowl, including spots featuring basketball star Jimmy Butler telling investors not to take advice from celebrities. But the company isn't advertising during the game itself.

"A Super Bowl ad does not make sense for us," said Patrick Hillmann, chief communications officer at Binance. "Education about crypto is not happening in 30-second ads during the Super Bowl. It's weird to market blockchain the way you would a bag of potato chips or light beer."

"You're seeing this massive influx of new users but there are concerns about the gap between total users and educated users," Hillmann added. "Those who understand the industry, the positives and the negatives, are more likely to be around for the long-term."

Toronto-based crypto trading firm Bitbuy has a Super Bowl ad that will run only in Canada that features Butler's Miami Heat teammate (and former Toronto Raptor) Kyle Lowry. The ad urges investors to not miss out on crypto trading and pokes fun at the number of shots Lowry has missed in his career.

Lowry told CNN Business that many athletes are talking about investing in cryptos, so advertising for it during one of the biggest sports events in the world makes sense.

"There are lot of conversations in the NBA talking about doing more in NFTs and cryptos," Lowry said. "People are trying to figure it out and trying to learn."

Bitbuy added in an email to CNN Business that the goal of the Super Bowl ad is to reach older Gen X and younger baby boomers who still may be on the crypto sidelines.

"Bitbuy has reached the point where growing our customer base means attracting new consumer segments," the company said. "You can't keep speaking to the same early adopters over and over again who have already jumped in crypto."

In another sign of how crypto is taking over the sports world, both Butler and Lowry now play in what's known as FTX Arena. The crypto firm secured the naming rights in 2021 for $135 million over 19 years. It had previously been the American Airlines Arena.

Crypto.com has a stadium deal, too. The Los Angeles Lakers and Clippers NBA teams, the Los Angeles Sparks WNBA franchise and Los Angeles Kings hockey team now play in Crypto.com Arena.

Coinbase is reportedly advertising during the Super Bowl as well, but the crypto brokerage, which went public last year, declined to comment about any commercial plans when asked by CNN Business.

Internet ad frenzy all over again?

The crypto marketing blitz is reminiscent of the deluge of dot-com companies and online brokers that splurged on commercials during the late 1990s and early 2000s. Several of those companies no longer exist. Epidemic.com and Pets.com (remember the sock puppet?) both advertised in the 2000 Super Bowl and didn't even make it to the end of that year.

Are the companies advertising this year destined for a similar fate, given the massive drop in crypto prices in the past few months?

"There are certainly shades of 2000, but we're not sitting under the same tree exactly," said Mitchell Olsen, assistant professor of marketing at the University of Notre Dame's Mendoza College of Business.

"These are relatively new industries generating interest from early adopters but not as much from the mainstream. They are now ready to reach out to a larger portion of people," Olsen added. "Time will tell if this is a high water mark for the industry."

The opportunity to reach more than 100 million viewers — last year's game was watched by 91.6 million on CBS — justifies the price of a Super Bowl ad, said Brett Harrison, president of FTX US.

"Every year the Super Bowl attracts the hottest and largest companies and has a reputation for its ads," Harrison said, adding that crypto trading is still a "nascent industry" and that "we want more eyes on the product." He also noted that, unlike many of those dot-coms from 20 years ago, FTX is profitable.


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