Binance’s Argentina division has unexpectedly decided to cancel its partnership with the Argentine Football Association (AFA), citing non-compliance issues as the reason behind such a move.
The initial intention was for the partnership between Binance’s Argentina division and the Argentine Football Association to span five years. However, the agreement came to an end after only one year with the crypto exchange attributing the termination to the Argentine Football Association’s (AFA) failure to meet contractual obligations, citing non-compliance as the primary reason.
Related Reading: TikTok Money Adverts In The Crosshair As Financial Watchdog Targets crypto Memes
Binance’s decision to terminate the contract with the AFA did not happen abruptly. The exchange states that they provided multiple opportunities and ample time for the AFA to address any concerns regarding contractual obligations.
Binance stated in its tweet:
We regularly evaluate the results of our partnerships around the world and unfortunately, despite being offered time and opportunities, the AFA has not fully complied with its contractual obligations, which goes against our business values and our partnership principles.
AFA’s Partnership With Binance Sparked Controversy
In January 2022, the crypto exchange secured a contract to sponsor Argentina’s national soccer team and assume the role of the naming sponsor for Argentina’s national soccer league. Controversy surrounded the deal from the beginning when the Argentine Soccer Association reportedly terminated its agreement with Socios, a fan token platform.
Following the termination of the agreement with Socios, the Argentine Soccer Association opted to enter into a partnership with Binance instead.
This decision led to a legal dispute between Socios and the AFA. The AFA accused Socios of defaulting on payments, inadequate promotion of the underperforming $ARG token, and unauthorized use of images associated with the national team and professional league.
Consequently, Socios took legal action against the AFA, claiming that their sponsorship contract was terminated unilaterally in favor of a similar agreement with competitor Binance. But despite the legal dispute, Socios continues to serve as the exclusive provider of the AFA’s official fan token, $ARG, until 2026.
Contract Termination With AFA Occurs During A Turbulent Period For Binance
The global bear market and ongoing regulatory crackdown have inflicted significant challenges on the cryptocurrency markets, and Binance, the world’s largest exchange, has not been immune to that.
The crypto exchange has encountered regulatory and legal obstacles on a global scale, which has recently led to the downsizing of its workforce by over 1,000 employees.
Additionally, the company’s declining profits have resulted in the discontinuation of certain employee benefits. There are reports suggesting that more than a third of Binance’s previous workforce of 8,000 employees may eventually face job cuts.
The partnership between AFA and Binance was not the Argentine Football Association’s (AFA) first involvement in the world of cryptocurrency.
Prior to Binance, the AFA had formed partnerships with other prominent names in the crypto industry, such as ByBit, which served as its primary sponsor. Additionally, the AFA had collaborated with Upland and BC.GAME in previous ventures.
Featured image from UnSplash, Chart from TradingView.com