Written by Hazel J. Greene, Senior Analyst

Binance’s Argentina division recently announced the unexpected termination of its partnership with the Argentine Football Association (AFA), citing non-compliance issues as the primary reason for their decision. The initial plan was for the partnership to last for five years, but it came to an end after only one year due to the AFA’s failure to meet contractual obligations.

The termination of the contract was not sudden, as Binance claims to have provided ample time and opportunities for the AFA to address concerns regarding compliance. In a tweet, Binance stated, “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.”

Controversy surrounded the partnership between Binance and the AFA from the start. In January 2022, Binance secured a sponsorship agreement to support Argentina’s national soccer team and become the naming sponsor for Argentina’s national soccer league. This decision led to a legal dispute between the AFA and Socios, a fan token platform, as the AFA terminated their agreement with Socios in favor of partnering with Binance.

Socios accused the AFA of unilaterally terminating their sponsorship contract and favoring a similar agreement with Binance. Despite the legal dispute, Socios continues to serve as the exclusive provider of the AFA’s official fan token, $ARG, until 2026.

The termination of the partnership between Binance and the AFA occurred against the backdrop of a turbulent period for Binance and the cryptocurrency industry as a whole. The global bear market and regulatory crackdowns have posed significant challenges, leading Binance to downsize its workforce by over 1,000 employees. The company’s declining profits have also resulted in the discontinuation of certain employee benefits, and rumors suggest that further job cuts may be on the horizon.

Prior to partnering with Binance, the AFA had collaborations with other prominent names in the crypto industry, such as ByBit, which served as its primary sponsor. The AFA had also engaged in ventures with Upland and BC.GAME.

The termination of the partnership between Binance’s Argentina division and the AFA serves as a reminder of the importance of contractual compliance and the potential challenges faced by companies in the cryptocurrency industry. As both parties move forward, it remains to be seen how this development will impact their respective futures and the wider crypto landscape.

Disclaimer: The information provided in this research report is for informational purposes only and should not be interpreted as financial or investment advice. The cryptocurrency market is highly volatile, and readers should conduct thorough research before making any investment decisions.