Ferrari ends cooperation with Velas blockchain

Ferrari recently announced the termination of its collaboration with Velas, which started in 2021. The car manufacturer has lost around 55 million dollars as a result of the contract termination. Read more about the reasons and consequences in this article.

Since the company’s management could not provide specifics, one of the causes is likely to be the declining market position of cryptocurrencies and unfavorable investor sentiment. After all, Ferrari is not the first corporation to suddenly halt its partnership with the crypto industry.

The company’s representative office gave the following announcement:

“Unfortunately, we have canceled the agreement with Velas early,” Ferrari told Bloomberg News in a statement. They did not disclose any further information, noting that commenting on subjects involving disputes, litigation, or other organizations is unacceptable.

Collaborations with crypto: goals

This partnership was intended to enhance interest in using NFT and blockchain products offered by crypto platforms.

NFT marketing: how does it work

Considering the NFT sector is still relatively new, partnerships between blockchains and large companies are widespread. At least, they used to be before the bear market and current market sentiments.

Nonetheless, the NFT industry provides marketers and businesses with a new option to establish and engage with their communities without being influenced by the platform’s algorithms.

As most small company owners and marketers know, successful marketing requires a strong community. In many ways, NFTs provide corporations with another opportunity for community building.

Replacement to be made

Indeed, F1 has gotten out of this situation with a ready-made solution. The logos of Romanian anti-viral software producer Bitdefender and Indian technology giant HCL Software will feature on Ferrari cars next season, according to Motorsport.

It’s worth mentioning that HCL Software was already on the livery of the red race at the end of last season’s Abu Dhabi Grand Prix. According to reports, the agreements with these firms will not be able to substitute Velas’ financial losses.

Ferrari also verified previously reported details concerning the end of its collaboration with Snapdragon. The one-year contract came to an end, and the parties decided not to extend it. The collaboration with Velas and Snapdragon is reported to have cost Ferrari $55 million.

As you may know, the reputation of the NFT sector skyrocketed during the 2021 bull market. In turn, this has resulted in the development of new tools and approaches for brand popularization. There have been numerous cases of a partnership between well-known organizations and blockchain startups since then.

However, many of these deals have already come to the end, in some cases because the crypto businesses were unable to make payments or opted to cut costs due to adverse market climates.