A cryptocurrency startup that partnered with some of the biggest names in sport has collapsed, leaving investors in the red and questions about its management.
When Sportemon Go launched in June last year, it was promoted as the “Pokemon Go” of the sporting world. Founded by former Australian Football League star, Ricky Jackson, and his son Corey Jackson, the pitch to investors included a sports trading platform that would create augmented reality experiences for fans, and an NFT marketplace selling collectibles of big name sports stars. The project was funded by its own cryptocurrency token, SGO. With a bold vision, and a well-known personality at the helm, investors bought in and the value of SGO spiked.
Over the months that followed, Sportemon Go announced a string of NFT deals with sports stars. NFTs, or non fungible tokens, are one-of-a-kind digital assets; in this case collectible cards of sporting heroes. In videos, Aussie athletes including cricket legend Adam Gilchrist, Aussie Rules great Gary Ablett Jr and champion hockey player and athlete Nova Peris, as well as Manchester United’s Luke Shaw and Liverpool’s Andy Robertson, talked positively about the deals.
Sportemon Go announced a string of NFT (non-fungible token) deals with sports stars.
“Appreciate the opportunity to be a part of something so exciting,” said Gilchrist, in a video chat with Ricky Jackson and Loren Renton. That video has also been deleted.
Renton works with Pickstar, a talent agency that helped connect Sportemon Go with the Australian athletes.
Sportemon Go used its social media channels to promote news of multi-year partnerships with Scottish football teams Rangers FC and Hibernian FC, New Zealand Super Rugby outfit the Hurricanes and an “exclusive 3-year deal” with the South Sydney Rabbitohs.
“Since that deal’s been done, our phone’s been ringing off the hook,” Corey Jackson said in an interview with last year.
In the Sportemon Go official Telegram group, a place where investors could get information about the project and chat, news circulated about an upcoming partnership with billionaire entrepreneur and “Shark Tank” investor Mark Cuban. “I invested when I saw the news that Mark Cuban’s subsidiary was investing,” wrote one group member.
Former Australian Football League star, Ricky Jackson, and his son Corey Jackson, jointly founded 'Sportemon Go'.
Earlier this year, investors' frustration was mounting. “I have lost trust in the team, everything that was planned has failed,” said one user in a post that’s since been deleted from the Telegram group. “What really happened so that the SGO project came to this?” asked another. And yet another claimed their original investment of $8000 was now worth just $400.
Sportemon Go has been criticised for draining liquidity from the project by selling off tokens to pay bills, including for the NFT-related athlete contracts, team sponsorships and advertising. Ricky Jackson publicly told token holders these were all necessary costs for what he called “a tokenised business”.
But some say that’s not how a crypto business, or any business, should work.
Robert Browning is part of a US-based group, SEEK, that analyses crypto projects.
“You can't take money that belongs to hard working people that rely on it as an investment. And you can't treat that any way you want to, just because you are the owner of a token, or just because you're the owner of a business,” he told The Feed. “If the model of the token doesn't support the business, you can't just drain it”.
Robert Browning is part of a US-based group, SEEK, that analyses crypto projects.
In April, facing increased criticism, Ricky Jackson told disgruntled investors they should “vote with their pocket” and “sell..if you’re unhappy.” But the Sportemon Go team had increased the sales tax, so investors would lose around 30 per cent every time they sold their tokens.
“Now you don't have investors, what you have are hostages,” says Robert Browning.
But Ricky Jackson told token holders to stop bad-mouthing the project in online forums; “support us and be part of the solution or shut the f*** up.”
The Feed is not suggesting that Sportemon Go or its founders have broken any laws. Ricky Jackson and his team insist they were always upfront with investors and haven’t misled anyone.
, Jackson stressed that Sportemon Go was always a “tokenized business, to be fully funded by the SGO BEP20 Token.” He said, at all times, “the Director and team have acted in accordance with professional business standards, within UK company law”. And he said “unfortunately the truth is simple, despite the best endeavours of the Director and Team, the SGO/SGOX token was incapable of funding the tokenised business plan and vision.”
He declined to provide specific information about how many tokens were sold off to pay for business costs.
For those who have lost money, the Sportemon Go collapse highlights the risks and volatility of crypto.
Aussie Rules great Gary Abblet Jr in a video promoting Sportemon Go' on social media.
And for those who’ve lost money on a failed crypto project, trying to recoup it via legal action isn’t easy.
In Australia, investors can make a complaint to corporate regulator ASIC if they believe they’ve been misled or deceived. They can also take private legal action, but in the absence of a specific crypto law, it can be complicated and costly.
“What we have is a bundle of laws that govern this, but they’re laws in old categories to govern a fundamentally new development,” Buckley says, making it more expensive than usual to pursue.
If the crypto business is registered off-shore, as many are, Buckley says you might as well “go to the pub and have a beer…it’s too expensive to try and enforce legal rights in this area abroad”.
The Feed reached out to some of the athletes who had partnered with Sportemon Go. They’re yet to respond. The South Sydney Rabbitohs declined to comment.
Ricky Jackson and his son Corey now have a bunch of other crypto-based ventures in the works. These include a virtual greyhound racing game where you can purchase an NFT dog, and an algorithmic stable coin project that they say will give former Sportemon Go holders 100 times returns on the value of their old coins after five years.
But five years is a long time in the volatile crypto market, and many investors are worried they won’t see anything. “Everything that was planned out has failed,” said one investor in the Telegram group, “and I can’t seem to find the trust anymore for the next direction they’re taking.”
