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Thursday, December 1, 2022

7 Pro Athletes Taking a Big Risk With Bitcoin Crypto Salary

As bitcoin soared to record highs, more and more professional athletes said they would receive some or all of their salaries and endorsement deals in crypto. 

Most of the commitments were made in 2021 when the total cryptocurrency market capitalization briefly touched $3 trillion and was consistently rising in value.

Odell Beckahm Jr. said in November he would take his $750,000 salary in bitcoin, while earlier this month two players on the NBA’s Golden State Warriors said part of their salary would be paid in bitcoin. 

And it’s not only athletes taking part of their salaries in bitcoin. Miami and New York City Mayors Francis Suarez and Eric Adams have received part of their salary in the cryptocurrency in a bid to demonstrate their cities’ openness to the fast-growing industry. 

But whereas bitcoin’s 2021 ascent highlighted the potential benefits of getting paid in the cryptocurrency, bitcoin’s recent price decline of about 50% is highlighting the downside


volatility

risk associated with getting paid in crypto.

Bitcoin has fallen from its mid-November high of about $69,000 to a low of about $35,000 this week, meaning some athletes have essentially taken a 50% pay cut for the same amount of work, assuming they didn’t immediately sell their bitcoin for traditional US dollars upon receipt.

Complicating bitcoin salaries even further is the tax implications, as you are taxed on the value of bitcoin when you receive it, not on what the value fluctuates too come tax season. That means if bitcoin falls far enough and stays there, some athletes’ tax bill may be more than the residual leftover value of their cryptocurrency.

Still, the potential remains for bitcoin to recover its losses and continue its long term uptrend, which would make the athletes decision to get paid in bitcoin look a lot smarter than it might today. 

These are seven professional athletes that have taken the risk on crypto and have some or all of their salary or endorsement deals being paid in crypto.

1. Klay Thompson

Klay Thompson smiles and dribbles the ball during warmups.

Klay Thompson is nearing a long-awaited return.

Jeff Chiu/AP Images


Team: Golden State Warriors
Date of deal: January 10, 2022
Bitcoin performance since deal: -13.7%

2. Andre Iguodala

andre iguodala



Jeff Chiu/AP


Team: Golden State Warriors
Date of deal: January 10, 2022
Bitcoin performance since deal: -13.7%

3. Odell Beckham Jr.

Odell Beckham Jr. #13 of the Cleveland Browns looks on during warm ups prior to the game against the Arizona Cardinals at FirstEnergy Stadium on October 17, 2021 in Cleveland, Ohio.

Odell Beckham Jr. #13 of the Cleveland Browns looks on during warm ups prior to the game against the Arizona Cardinals at FirstEnergy Stadium on October 17, 2021 in Cleveland, Ohio.

Emilee Chinn/Getty Images


Team: Los Angeles Rams
Date of deal: November 22, 2021
Bitcoin performance since deal: -36.0%

4. Shohei Ohtani

Shohei Ohtani of the Los Angeles Angels watches his home run against the Seattle Mariners during the first inning at T-Mobile Park on October 03, 2021 in Seattle, Washington.

Shohei Ohtani

Steph Chambers/Getty Images


Team: Los Angeles Angels
Date of deal: November 16, 2021
Bitcoin performance since deal: -39.7%

5. Aaron Rodgers

Aaron Rodgers looks to throw against the Seattle Seahawks.

Aaron Rodgers.

AP Photo/Aaron Gash


Team: Green Bay Packers
Date of deal: November 1, 2021
Bitcoin performance since deal: -40.5%

6. Cade Cunningham

Cade Cunningham #2 of the Detroit Piston brings the ball up the court against Miles McBride #2 of the New York Knicks during the 2021 NBA Summer League at the Thomas & Mack Center on August 13, 2021 in Las Vegas, Nevada.

Cade Cunningham #2 of the Detroit Piston brings the ball up the court against Miles McBride #2 of the New York Knicks during the 2021 NBA Summer League at the Thomas & Mack Center on August 13, 2021 in Las Vegas, Nevada.

Ethan Miller/Getty Images


Team: Detroit Pistons
Date of deal: August 19, 2021
Bitcoin performance since deal: -22.9%

7. Trevor Lawrence

Jacksonville Jaguars quarterback Trevor Lawrence looks for a receiver against the Cleveland Browns.

Trevor Lawrence.

AP Photo/Phelan M. Ebenhack


Team: Jacksonville Jaguars
Date of deal: April 26, 2021
Bitcoin performance since deal: -32.7%

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