Dallas Mavericks fans are getting burned by the bankruptcy of ill-fated crypto brokerage Voyager Digital — and they’re lashing out at the NBA team’s owner Mark Cuban for luring them to invest in the company.
Voyager declared Chapter 11 late Tuesday, citing chaos in the crypto markets. The major crypto player had paid high interest rates on crypto deposits and got crunched as it sought to lend out tokens at even higher rates. Most account holders will be hard-pressed to get back their money, according to reports.
“Shame on Mark for partnering with them,” one Mavericks fan posted on Reddit, referring to the team’s billionaire owner and longtime “Shark Tank” investor.
“Thank you Mr. Cuban. Getting your fans to trust unstable exchanges. Brilliant,” another user fumed sarcastically.
“Another Cuban special,” a third wrote.
Cuban didn’t immediately respond to questions from The Post on Wednesday, including whether the Mavs are now a Voyager creditor with claims in bankruptcy court.
The Mavericks on Oct. 28 of last year announced a five-year partnership with Voyager giving fans a $100 reward to trade crypto on Voyager for a limited time if they deposited $100 and traded just $10. At the time, Cuban said the Voyager partnership would make cryptocurrency more accessible.
“We’re going to come up with new ways to introduce Mavs fans to cryptocurrency and help them understand it,” Cuban said at the time. “You know, there’s a lot of hype, there’s a lot of discussion, but most people don’t understand the fundamentals behind it.”
Cuban had even staged a press conference that day with Voyager CEO Steve Ehrlich, where newly signed New York Knick Jalen Brunson, then a Maverick, asked, “If this is my first time getting into crypto, what are some key things I need to know?”
“Yeah, you’re spending your money, so always be careful,” Cuban responded at the time. “But the other thing, look, there’s investments, things like Shiba Inu and Dogecoin, those aren’t investments. But Voyager … this is a good way to learn and it’s something you can do on your smart phone. You can start getting into this and saving your money and that’s just a unique opportunity.”
Voyager’s stock rose 9.5 percent on Oct. 28 to around $17 per share. On Wednesday, it was trading at 26 cents.
Large crypto exchanges binged on sponsorship deals in 2021 in an effort to woo sports fans, many of whom were flush with cash in a tight labor market, fresh on the heels of generous government stimulus from the pandemic. Now, as The Post reported exclusively, crypto firms are ditching sports deals.
“These struggles with crypto sponsors will lead all clubs to re-examine their sponsors risk-profiles, particularly for new industry categories,” Rick Allen, CEO of sports streaming consultant firm ViewLift told The Post.
“I’d expect teams and leagues to recheck their deals, especially for sponsors in crypto currencies, gambling, NFTs and other new categories where the lack of actual loss data made risk underwriting more speculative,” Allen added.
In a Fortune article just last month, Cuban said there will be winners and losers in crypto.
“In stocks and crypto, you will see companies that were sustained by cheap, easy money — but didn’t have valid business prospects — will disappear,” Cuban said. “Like [Warren] Buffett says, ‘When the tide goes out, you get to see who is swimming naked.’”
[Written in collaboration with other media outlets with information from the following sources]
