McLaren and its fans faced huge financial losses after Iqoniq, a cryptocurrency-based platform, went into liquidation. Fans were expected to lose as much as $3,000,000 after the Papayas failed to do due diligence while signing the deal.
McLaren paired up with Iqoniq in July 2020 and agreed to receive a 50% commission on all tokens. And with the company getting folded, McLaren also didn’t receive half of the commission they made for signing up fans to the crypto tokens.
The Woking-based team was within three years of the agreement with the Crypto-based site, and it would receive a sum of $600,000 for the name of the company on the helmets of wheel-change crews. Thus, it was a solid alliance on paper until things went down.
McLaren’s Blunder and how it hampered fans
The McLaren faithful, who have immense support for the team, bought tokens sponsored by their team. However, with the company liquidated, it’s all worthless now.
Furthermore, the report by Business F1 says that it’s not sure how much money the fans or the team has actually lost. But it is estimated that they have lost around $3,000,000.
According to The Times, cryptocurrency-based fan platform IQONIQ has gone into liquidation, leaving behind many virtually worthless tokens.
IQONIQ sponsored McLaren, Alfa Romeo and Williams through 2020 and 2021, before quietly disappearing.#F1 #IQONIQ #sponsorship #crypto pic.twitter.com/kpBMtgM2ZO
— Decalspotters (@decalspotters) January 27, 2022
On the other hand, the British team was also at a significant loss as Iqoniq owed them around $750,000 before the liquidation; as mentioned before that they didn’t receive half of the commission they made by getting people to buy the crypto tokens, while Kazim Atilla reportedly ran off with $100 million invested money.
McLaren wasn’t the only team that suffered
Apart from the Papayas, two more F1 teams, such as Alfa Romeo and Williams, also tied up with them. Moreover, teams like Crystal Palace of the English Premier League, AS Roma of Serie A, Valencia CF and Real Sociedad of La Liga, North Carolina FC of Major League Soccer, AS Monaco, and Olympique de Marseilles, among many others were affected by the collapse.
Notably, the Chief Executive Officer of Iqoniq, Atilla, revealed, as per Business F1, that the reason for the collapse of the company was due to the global COVID-19 pandemic that hit the globe in 2020.
Admittedly, with this, the world of cryptocurrency has also proved extremely risky after FTX’s fall. FTX was an esteemed partner of the Mercedes AMG PETRONAS team until they went into liquidation in November 2022, leaving behind huge losses for the team and the fans.
