Super Bowl LVI Ads: Expect Less Crypto This Year

New York (CNN) Super Bowl LVI was the crypto world’s coming out party. Buzzy firms made bold presentations last year, shelling out millions of dollars on ads encouraging viewers not to be afraid of this newfangled digital investment – ​​and for God’s sake, don’t miss out on this exciting opportunity!

You can expect a lot less noise from Team Crypto during Super Bowl LVII next Sunday.

In the year since the celebrity-studded ads debuted, the entire crypto industry has been rocked by one collapse in digital asset values. Bankruptcy began to pile up over the summer.

Then the real pain began.

Of the four crypto or crypto-related companies that announced in the Super Bowl last year, one (FTX) has completely collapsed. The others (Coinbase, Crypto.com and eToro) have battled industry headwinds. Shares in Coinbase, the only publicly traded company in the group, have fallen more than 60% since the “floating QR code” ad became one of the most talked about spots.

Don’t expect any of these companies to return this year. FTX is bankrupt and under criminal investigation by federal prosecutors. Etoro, a multi-asset trading platform, confirmed to CNN that it would not pursue an ad this year, saying that while it continues to invest heavily in marketing, “we dial up or down specific channels based on many factors, including market conditions .”

Coinbase declined to comment. Representatives for Crypto.com — the company behind the ad featuring LeBron James telling his younger self to “call your own chances” — did not respond to requests for comment.

But there will be at least one crypto-adjacent newcomer. Limit Break, a blockchain-based game developer, has secured a spot and intends to give away around 10,000 NFTs, or non-fungible tokens (aka one-of-a-kind digital collectibles) to viewers who scan the QR code . Limit Break, founded in 2021, said it has already raised $200 million and expects to grow “a massive global audience.”

Crypto marketing is adapting

Despite what’s being called a “crypto winter,” sports advertising remains a crucial avenue for the digital currency, marketing experts say, as its target demographics share significant overlap — sports fans and crypto traders tend to be mostly male and mostly young.

But turmoil in the crypto space means marketers are changing tactics.

“The tone has shifted towards Web3-driven fan engagement over crypto-specific advertising,” said Silvia Lacayo, head of marketing at crypto exchange Bitstamp US. (Web3 refers to a future internet framework that is decentralized and gives consumers more control over their own data).

“Crypto firms are focusing less on crypto advertising and more on investing in better user experiences, products and customer service,” Lacayo added.

While we don’t yet know the final lineup of advertisers for the Super Bowl, the usual suspects—beer, snacks, cars—are on deck as usual.

“The fact that the crypto players are not going to be in the Super Bowl reflects the fact that that world has changed profoundly,” said Tim Calkins, professor of marketing at Northwestern University’s Kellogg School of Management.

“Last year was an exuberant time for crypto… This year everything is different.”

What a difference a year makes

A year ago, FTX achieved a private valuation of around $32 billion. The Super Bowl ads featured Tom Brady and Gisele Bundchen. Another FTX ad featured Larry David in a role that a year later seems prescient, with David sarcastically predicting that FTX won’t make it.

In November, nine months after the ad debuted, FTX filed for bankruptcy. Several former executives have been charged with wire fraud and conspiracy due to allegations that FTX misused customer funds.

“It’s amazing how you can look back one year you realize we were in such a different place,” Calkins said. “Last year we had a Super Bowl ad that said ‘fly me to the moon,'” he said, referring to the music in eToro’s ad, which many read as a nod to the meme stock traders’ rallying cry.

But a year of higher inflation, the end of stimulus from the pandemic and higher interest rates have put a damper on financial markets – not just crypto, but traditional markets as well.

That shift in sentiment is likely to show up in the types of advertisers we see and in their messaging.

“Our economy is in a strange place,” Calkins says. “So if you’re an advertiser, it’s hard to know — how do you play it?”

Correction: An earlier version of this story misstated the number of NFTs that Limit Break intends to give away in its Super Bowl ad. It is 10,000.