Since 2013, Cryptocurrency has quickly become one of the most lucrative industries in the world. You could even argue that it is the most lucrative. The price of blockchain currency has gone through the roof with 1 Bitcoin now worth over $60,000. For a long time, Bitcoin essentially had the market cornered. It is still the most valuable on the market, but as its price continued to rise and blockchain technology became more accessible, thousands of other coins were birthed. In 2021 there are estimated to be over 6000 digital coins available to buy and trade with, a monumental rise when you learn that there were only a handful of coins available in 2013.
With that popularity has come innovation and nobody has innovated blockchain tech quite like artists have. by creating digital assets known as ‘Non-fungible tokens’. But what makes them so popular? Well the clue is in the name. NFTs by design are unique and non-fungible in that they cannot be traded or replaced for an identical asset.
The token itself holds ‘totally unique and non-interchangeable unit of data stored on a digital ledger that uses blockchain technology to establish proof of ownership’. They are digital pieces of art that hold value, just like physical art. They could come in the form of an image, a gif, a video or even a piece of music. If you are still struggling to wrap your head around them just think of them as Crypto-baseball cards. They are made to be collected, traded or even sold. A one-of-a-kind card is Non-Fungible as you cannot trade it for an identical card, just like an NFT.
This is why they are particularly suited to the sporting industry. You can collect sports NFT’s just like you would memorabilia. It has become such a phenomenon in sports that many high-profile athletes have not only invested in them but have also created NFTs of their own. It doesn’t matter which sport you follow: NFL, NBA, even the English Premier League— there is an NFT for you. One of the best places to shop for your tokens is through DraftKings’ NFT marketplace. They recently sold a mystery container for one of the twenty-five potential collectibles within the Tom Brady Origins Collection. They are also soon to be selling a mystery container for legendary skateboarder Tony Hawk. With five drops on DraftKings’ scheduled drop day, users join a queue to for a limited number of NFTs. If they are successful, you can then view your token in the DraftKings Marketplace portfolio.
For fans, NFTs are a way to enhance relationships with their favourite teams and athletes. Everyone has bought their favourite ball player’s jersey but imagine instead owning a totally unique piece of sports history that only you own and that nobody else has ever seen before.You can even trade them for different ones. In many ways, it is all of our childhood fantasies brought to life but instead of your Micky Mantle cards it’s a Lebron James dunk NFT.
It is not just fans who benefit though, it also a lucrative revenue stream for teams, athletes and leagues. As reported by Deloitte, the largest football (soccer) NFT platform enabled US$128 million in sales in the first nine months of 2021. All of this could not have come at a better time for those involved. The coronavirus pandemic has seen hundreds of teams and leagues lose eye-watering amounts of money. For example, the NBA’s revenue at the end of the 19/20 season dropped 10%. The opportunity to create a new revenue stream at essentially zero cost has undoubtably lifted the spirits of NBA execs, allowing them to recoup their losses.
The meteoric rise of NFTs in sport is further evidenced when you look at Dapper Labs’ revenue. One of the biggest sports NFT marketplaces in the world, Dapper Labs saw its annual sales nearly double to $700 million last year from $361 million in 2019.
As they evolve and become more detailed, there is no telling by just how much the current numbers we are seeing could grow. With AR and VR becoming more mainstream, especially with Facebook’s new ‘Metaverse’, the content is certainly going to become more immersive. It appears that NFTs are here for the long haul and the sports industry certainly will not be the last to get in on the action.
Musicians, video game companies, movie stars— you name it, there is an NFT specific to that field. Cryptocurrency and Blockchain technology as a whole were long written off as a fad. NFTs were quickly written off as a meme. They both replied by becoming not just a part of pop culture, but a part of our everyday lives. Whether you see them as a great business opportunity or just a fun way for people to collect digital memorabilia, NFTs are here to stay.
