Sports go crypto: How clubs and players are embracing crypto
Crypto and sports? The decentralised nature of Blockchain, Bitcoin, and cryptocurrencies gives the perfect incentive for the transformation of how fans interact with their sport idols while facilitating the transparency and revenue of clubs worldwide. Who doesn’t remember gathering all the trading cards for each World championship and trading with their friends in hopes of completing the entire album?
Since the first World Cup tournaments, fans have gathered to watch their countries play in the quest for a championship while clubs and organisations created a market around its enthusiasm.
Now, sports can take advantage of crypto’s global, decentralised, and permissionless nature to close the gap between fans and their idols while bringing more transparency and growth to the sports industry.
Sports collectibles going digital amid NFT craze
Crypto is meeting sports with football leagues and clubs, with the NFL and the NBA leading the way.
Native digital collectible platforms such as Sorare bring the physical world of trading cards and football memorabilia to the digital space by tokenising these physical assets and creating a digital marketplace for worldwide collectors to interact. Similarly, in the US, NBA Topshot revealed the immense market for digital collectibles across formats around people’s favorite sports and personalities.
Many clubs and organisations are launching digital-based recordings, photos of historical moments, and other physical collectibles turned into Non-Fungible Tokens (NFTs) for enthusiasts worldwide.
For example, Ethernity Chain (NFT marketplace) and Pelé, arguably the best football player of all time, released a series of trading cards as NFTs. However, the NFT market does not rely upon only legends. Today’s most notorious players such as Cristiano Ronaldo or Kylian Mbappé joined the tokenisation train with launches of trading cards amid NFTs reaching record-levels in auction sales. Cristiano Ronaldo’s NFT sold for $290,000, becoming the world’s most expensive football card ever traded, beating the previous record held by Erling Braut Haaland’s NFT — leading striker of Borussia Dortmund.
Even brick-and-mortar businesses like Panini, which releases card albums from European championships and World Cups, started to convert to the digital collectible space with Blockchain-based initiatives.
Be a digital owner: Clubs’ fan tokens
“Trading cards aren’t cool.. you know what’s cool? Being a Digital owner.” Ok, we can agree both things are cool. Let us explain.
Clubs don’t want to miss the boat of digitalisation while searching for ways for fans to interact and start building online communities with hopes of monetisation. Sport tokenisation platforms like Chiliz work with clubs to release tokens where fans can have a more direct intervention with players and clubs. At the same time, it generates a secondary market for token trading as these are available on crypto exchanges, equivalent to trading stocks or other cryptocurrencies. On top of the emotional attachment that fans have with clubs, the introduction of tokens also allows them to mingle with the investment space.
Top European football teams such as Manchester City, Paris Saint Germain, FC Barcelona, and Juventus have joined the ship with leading sports organisations as the UFC is also going to be tokenised. While you won’t be a shareholder of the club, the participation rights of holding such tokens can evolve, with increased importance on the relationships between the fans, players, and clubs.
The sports-crypto trifecta: Clubs, fans, and players going full crypto
Beyond clubs and fans becoming interconnected, players are a key agent for sports transformation into crypto. At the end of the day, fans are connected to players, idolising their accomplishments. As a result, many clubs and players started to draw up compensation plans in cryptocurrency or receiving club tokens.
Recently, Southampton FC started to give the option to their players to get bonuses paid in Bitcoin after other Premier league clubs followed similar initiatives. For example, Cristiano Ronaldo received the Juventus fan token as compensation for each goal he has scored in his career (770 in total at the time).
In the US, NFL’s first draft pick, Trevor Lawrence, is receiving his signing bonus in cryptocurrency amid Sean Culkin becoming the first NFL player to receive his full salary in Bitcoin.
Most recently, FTX finalised their sponsorship deal with MLB, meaning umpires will be required to wear the FTX logo. They crypto exchange is also dipping their toes into the NBA world, partnering with Miami Heat, renaming the stadium to the FTX Arena. But that’s not all, they’re also sponsoring one of the largest eSports teams in the world, TSM, for a whopping $210 million! All of these sponsorships are a huge leap for a crypto company to get into sports and attract a new audience, which they seem devout on catering to with an aggressive marketing push.
The last stage: Transfer and full Blockchain conversion
A later stage of development in sports going crypto would be the full integration of all the processes involved in sports (e.g., transfers, club management, ticket sales, fan relationships).
The Blockchain opens a new array of opportunities to expand marketable products while simplifying and bringing transparency to most sports transactions (e.g., ticket payment options, player transfers, players’ compensation). In lower football divisions, player transfers have been conducted with Bitcoin, completely changing the way the economics of sports works while eliminating any trace of possible irregularities due to the traceability of the Blockchain.
With famous retired players across sports starting to lead venture capital investment in tech and crypto startups, there’s a good chance there will be a push into a change in the sports arena in the near future.
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