Written by: Aleksandr Iurev, Executive Contributor
Executive Contributors at Brainz Magazine are handpicked and invited to contribute because of their knowledge and valuable insight within their area of expertise.
The range of use for NFT in the sports industry is expanding rapidly, and this trend will continue. Digital assets offer new ways for teams to connect to fans and launch new revenue sources.
The global economy is in the midst of the most ambitious restructuring ever. Every industry must be ‘greened’ and oriented towards sustainability and finding ways to decrease our carbon footprint and consume less, thereby leaving behind less garbage and waste. NFTs can play an important role to play in this transformation.
Non-fungible tokens (NFTs) are digital assets that run on the blockchain and are crypto collectibles. Each NFT is a unique asset that can be digital or represent a tokenized version of a physical item.
NFTs have seen rapid growth in recent years, and they are radically changing the landscape of various industries like arts, gaming, music, and sports. According to Deloitte, sports NFTs alone could generate over $2 billion in revenues in 2022.
Many people have trouble understanding how NFTs can be applicable to the sports industry. They think that NFTs are just something for digital art enthusiasts and as a toy of sorts for the Tech community. But that’s not true.
Sports events in the Metaverse
In sports, NFTs have a number of important and potentially lucrative applications. Of course, one very basic and obvious function is the use of NFTs as digital versions of the traditional basketball or football player cards that kids have collected for decades. But that’s not all. So, let’s first take a closer look at some highly innovative uses.
How can these digital tokens change the sports world? There are two major ways. The first is that NFTs give fans new ways to support their teams; this allows sports clubs, leagues and organizations to benefit from a new revenue stream by issuing digital collectibles.
Also, NFTs allow fans to directly interact with athletes in virtual environments, for example, during meet-and-greets in the Metaverse. This will help to improve fan loyalty and expand fan engagement to embrace audiences across the globe.
Traditionally, the primary sources of revenue for a sports business have been tickets, merchandise sales, media rights, and sponsorships. Issuing NFTs will create opportunities for an additional revenue streams for sports teams.
For example, during an emergency situation, such as a pandemic, teams can use NFTs to tokenize game tickets, as well as stream live games to token holders, or even plan holder-only events in the Metaverse. Also, sports NFTs can serve as a form of fan club membership that gives their holders exclusive perks, such as access to meet-and-greet events with athletes.
Digital sports memorabilia
NFTs are transforming the concept of sports memorabilia by enabling fans to own the cards of their favorite players and even game videos of them in action. Sports collectibles are new ways for fans to collect player cards and even video highlights from games.
One of the most popular is NBA Top Shot, a basketball collectible platform that uses blockchain to digitalize traditional sports cards. It serves as an NFT marketplace that, for example, allows fans to trade video clips of legendary NBA game highlights.
Thanks to blockchain, these physical cards are now transformed into NFTs that sports enthusiasts can collect — memorabilia, gifs, video highlights, etc. Some companies are already making digital player cards. They can sell the card, make a profit, and collect 3-10% in royalties on any resales in the future. Some of the busiest NFT marketplaces for sports items are: OpenSea, Autograph, Rarible.
Here are the Top 5 most expensive sports NFTs:
Statue of LeBron James — $21.6 million.
MLB Champions Brett Gardner — $21.28 million.
Jermall Charlo: Lions Only GOLD ULTIMATE — $19 million.
Michael Jordan SportPunk — $5 million; and
Rare Diego Maradona 2020 — $4.3 million.
Finally, one other benefit from the use of NFTs in sports is that athletes can own their intellectual property rights by issuing NFTs themselves. As NFT creators, they can receive royalty fees from the resales of their NFTs. This is certainly an important part of protecting the rights of talented players in a highly commercialized sports industry.
Most of what I described above is being applied to professional teams. However, college, high school and even kids’ club teams can also apply this business model. We are clearly on the cusp of a major revolution in the sports business. All that remains is for people to seize this incredible opportunity.
Aleksandr Iurev, Executive Contributor Brainz Magazine
Aleksandr Iurev is a serial entrepreneur, with many years of experience in launching startups. His most recent is Pocketfied, which will radically disrupt the mobile app development industry with its highly innovative technology and service. Overall, Mr. Iurev has 20 years of experience in the IT sector, as well as in DevOps, and Information Security. He cut his teeth in Tech working in IT security for the largest banks in Russia, as well as for top IT companies. That experience protecting clients from hacker attacks is one reason why he attaches top priority to building secure systems so that users can be certain they're protected.
