The adoption of blockchain is spreading like wildfire across industries and the sports industry isn't an exception to this. Non-fungible tokens (NFTs) are a new type of digital asset existing on a blockchain and have driven growth across multiple sports. With more than 8,000 different kinds of sports being played across the world today, NFTs are set to disrupt the ecosystem for fans, players, brands, clubs, federations, leagues and intellectual property owners.
While the first set of NFTs was created around 2012, it started picking up only in 2017-18. Currently, major NFT opportunities in the sports universe are around content like digital trading cards and artwork of players, graphics, avatars, branded content, 3D art, videos and event ticketing. It is an evolving space and creators are finding more unique ways to create NFTs across different sports and offer it to fans for engagement.
Other forms of NFTs like there is sports memorabilia like certificates, awards, autographs of your favourite players and trophies that are grabbing attention.
(Lots of sports T-shirts, accerssories, shoes, socks etc also much popular)
These sports-themed digital collectibles make it easier for fans to engage with their favourite teams or athletes. On the other hand, brands get to engage with their fans directly. Major brands are also looking to use NFTs as part of sponsorship deals as they will allow them to cash in on global fans who want equity within clubs.
Tokens on the blockchain bring the physical items into circulation while retaining their original value through tokenisation, increasing both their security as well as the fans’ loyalty towards a specific team or athlete. The NFTs will not just bring the items on chain but also increase their value due to their tokenisation onto blockchains such as Bitcoin or Ethereum.
Imagine coming home from work and seeing your favourite player's jersey on the wall. But not just any old shirt—a customised and autographed piece of sports history that only you know about because no one else has ever seen that exact design before, at least not for very long. The NFTs bring such childhood fantasies to life in real time through blockchain technology where players trade their own virtual goods with collectors around the world. It is also done without the fear of authenticity being compromised, thanks to security measures like encryption algorithms and other authentication features on the blockchain.
If you're a sports buff and enjoy collecting items like trading cards, then such NFTs are the perfect investment opportunity for you. One of the key reasons fans want to own a collectible item is to showcase and brag about it. With NFTs, they are not only able to own that item but also trade and make money digitally. NFT is a new asset class and hence, massive investments in sports NFTs are going to drive the fans as well as traders and investors to get into this new money-making opportunity.
Today, I see a lot of collaboration happening between NFT platforms, players, brands and digital creators—all of whom will directly create innovative, original and branded content for fans. Players will become creators themselves and create a lot of behind-the-scenes content which will be minted as NFTs for fans who continuously want to engage with them on and off the field.
And it's already happening. While a lot of such content is being shared directly on various social media platforms, the opportunity for fans now is to own these as NFTs.
The future, however, holds promise for more immersive digital content like AR, VR, high-end 3D videos and, above all, the Metaverse, a cool, futuristic virtual world very much inspired by the gaming world, where collectors will be able to showcase their collected NFTs. There will be a shift to the Metaverse from channels like Instagram and Facebook, and from WhatsApp status’ and Zoom backgrounds.
I am a big fan of the Metaverse and crazy things are currently happening in that space. While Facebook has already announced that it is moving towards a metaverse experience, games like Fortnite have already given us a glimpse of what the Metaverse looks like today. I also see it transforming the whole sports experience.
The sports NFT market is brand new with tremendous potential and is growing fast. Reuters recently reported that NFTs worth $2.5 billion were sold in the first half of 2021 alone.
NBA Top Shot and Sorare, two of the most popular NFT start-ups, have raised more than $1 billion in funding and have made over $1 billion in sales between them so far. NBA Top Shot provides short video moments of NBA’s top basketball players as NFT collectibles. Sorare, on the other hand, is a fantasy football platform and provides tradable cards as NFTs. So far, $200 million worth of cards have been traded on the platform which has also partnered with over 180 football clubs worldwide, including top European clubs like Real Madrid.
Ethernity, a marketplace platform, had launched NFTs with popular Argentine footballer Lionel Messi under its ‘Messiverse’ collection in August this year. It ended up generating around $3.2 million in sales in an hour and was sold out. Platforms like Crypto.com, Mintable, Opensea and Raible have also been selling mostly digital art and videos of players from top sports like F1, football, tennis and more. Sports brands and leagues are now launching their own NFT marketplaces—UFC for Mixed Martial Arts NFTs, Candy Digital for baseball NFTs, NASCAR for stock car racing NFTs, among others. Another interesting platform is a digital horse racing platform called Zed Run which allows you to buy your own horses as NFTs and make them race. Fantasy sports platforms like RARIO (cricket) and RealFevr (football) have also jumped into the sports NFT wagon.
With many sports NFT platforms releasing every month globally, the key is to make sure that you’re buying the NFTs from the sports brands directly as they continue to evaluate this new opportunity. My recommendation to every sports brand, player and IP owner is to quickly find an NFT partner and launch. Also, as there are many use cases, brands should be open to working with multiple NFT innovators. It is almost like the start of the commercial Internet age in 1995. India is waking up to the craze of NFTs and I strongly believe that a lot of disruption will happen in the sports ecosystem in India.
Today, NFTs have made it possible for fans to own the best sports collectibles directly from the content owners without the middleman and without any revenue leakage. On the other side of the spectrum, IP owners get to earn lifelong royalties directly from fans when they trade or sell the NFTs at a secondary marketplace. Copyright is also protected because the originality of the content will always be on the blockchain. This is a new space and hence, education is required. Governments across the globe are watching the new trend and the Indian government is currently reviewing this new asset class as part of the whole cryptocurrency scene.
All of this indicates that sports NFTs are here to stay. They are a movement and not a meme. The world is about to get better without the "middleman'' and people need to learn about it. If you are an entrepreneur and want your business to be relevant in 10 years, I would ask you to learn about it as well.
I do not doubt the fact that we will see a massive usage of NFTs in the near future. The sky's the limit here and we will see many disruptive sports projects through NFTs. As an NFT collector and creator myself, I can say that a whole new opportunity across the sports world awaits.
(Sidarttha Bezbora is the founder & CEO of VOAX HUB INC. Views expressed in the article are personal)