Bitcoin Pay: Crypto Market Falls Lead to Questions

Cryptocurrency prices are in the doldrums, but that’s not stopping some high-profile athletes from using bitcoin pay for receiving their pay. While digital assets like bitcoin have gained a reputation for trading in an uncorrelated way to the S&P 500 index, they’ve been unable to escape the risk-off mood among stock market investors.

The bitcoin price has been more than cut in half since November levels, falling from a peak of close to $69,000 to about $33,700 today. The S&P 500, meanwhile, has fallen over 10% from its recent peak, placing the index in correction territory.

Bitcoin 6-Month Chart | Source: TradingView

Ethereum, the second-biggest cryptocurrency, has seen its price tumble by 30% in the last few days alone to $2,230 after trading above $4,000 in December.

Ethereum 5-Day Chart | Source: TradingView

Crypto Pay

Despite the volatility, crypto enthusiasts still choose to see the glass as half full. Not only that, but professional athletes who are commanding up to seven-digital salaries are increasingly opting to be paid in bitcoin instead of cold hard cash. Among them, Francis Ngannou, the UFC heavyweight champion of the world, has caught bitcoin fever.

Ngannou retained the heavyweight title in UFC 270 at the Honda Center over the weekend, beating Ciryl Gane in the main event and scoring the coveted belt. UFC President Dana White was conspicuously absent from the title ceremony, with whom Ngannou is currently embattled in a contract dispute.

Meanwhile, the fighter agreed to be paid 50% of his UFC purse or $300,000 in BTC even while the asset’s value has been more than halved. The heavyweight champion believes “bitcoin can empower people everywhere.”

He is doing his part to thrust bitcoin into the mainstream and has partnered with Jack Dorsey’s company Block to give away $300,000 in bitcoin via the Cash App on social media. Based on the responses on social media, winners are being paid about 0.00036009 BTC, or roughly $12. By giving away these bitcoins, Ngannou also showcases how easy it is for mainstream investors to gain access to bitcoin on the Cash App, which boasts 40 million-plus monthly active users.

NFL Players Are Early Bitcoin Movers

Mixed martial arts is not the only arena where athletes receive their pay in crypto. The NFL’s Odell Beckham Jr., a wide receiver for the Los Angeles Rams, revealed in November that he would take his $750,000 guaranteed pay ( worth up to $4.25 million in total pay) from the team in BTC for the current season. He joins a growing list that extends to Aaron Rodgers, who agreed to take part of his $33.5 million salary in BTC.

The Action Network’s Darren Rovell was quick to point out that when Beckham signed his contract, the bitcoin price was trading at over $64,000 per BTC. According to Rovell’s calculations, that means Beckham’s contract is now worth less than $413,000 even before being taxed for the whole shebang, which he pegs at roughly 50% for federal and California state taxes, bringing the NFL player’s take-home pay to about $35,700. Ouch.

Joe Pompliano of Pomp Investments, who has 354,000 Twitter followers, poked holes in Rovell’s theory, commenting in the thread that Rovell’s narrative is false. Pompliano states that NFL players are paid weekly, not lump-sum.

Besides, Beckham earns a seven-figure amount from a marketing deal he inked with Block’s Cash App, delivering him a bigger payday than his NFL contract. In other words, OBJ is probably not losing any sleep. Besides, bitcoin fans are pros at taking the roller coaster ride that the leading cryptocurrency is famous for.

Source: Twitter

Beckham has gone further down the crypto rabbit hole to dabble in non-fungible tokens or NFTs. He is the owner of a CryptoPunk NFT, one of the hottest collections available, which he displayed on a t-shirt during the team’s recent warmups. The NFL recently expanded its collection of ticket NFTs to include digital playoff and Super Bowl tickets.

The NFL season is winding down, with just four teams left on the road to Super Bowl LVI. However, if the 2021/2022 season is any indication, bitcoin salaries are a growing trend that could extend into the next season. It’s anyone’s guess where the bitcoin price will be trading by then.

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At the time of writing, neither Tim Thomas nor Timothy Thomas Limited hold positions in the cryptocurrencies mentioned.

This post was produced by Wealth of Geeks and was syndicated by Tim Thomas / Timothy Thomas Limited

Featured image credit: Upslash