Blood From a Stone 

Perhaps an auto-terminating contract would’ve made more sense?

You’ve probably heard something about FTX recently. They were one of the world’s largest crypto exchanges right up until they collapsed into dust earlier this month. Financial funnyman Matt Levine has covered the saga in depth, but the short of it is that FTX lost a whole bunch of customer money and eventually faced a solvency crunch that brought them down. They’ve now filed for bankruptcy.

That’s a bad thing for those involved, a group which includes a lot of major businesses who took FTX’s money for advertising. For instance, there’s Miami-Dade County, which took sold the naming rights to their arena for $135 million. They’re now trying to get out of the deal.

FTX already has paid Miami-Dade almost $20 million, and has a $5.5 million payment due in January. Under the deal’s terms, a default on FTX’s part would require the company to pay the county for three years. That amounts to $17 million, which the county is seeking in damages, according to the county’s court filing.

It might have been ill-advised to construct a deal where a default by FTX incurs a monetary penalty which will likely never be recovered, yet doesn’t result in nullification of the arrangement.