NFTs in Sports: What Exactly Can Be Tokenized?
We are all already familiar with the concepts of blockchain, Bitcoin, and cryptocurrencies, but recently a novel phenomenon has taken the world by storm. Meet NFTs – a new player in the sports arena and beyond.
Just as we have experienced a boom in cryptocurrencies in recent years, today we are seeing a new craze that is also related to blockchain – NFTs. These are tokens that athletes, artists, celebrities, and influencers not only issue and sell but also use to give their fans unforgettable experiences.
The value and demand for NFTs are astounding. Just take a look at the numbers: as of May 28, 2021, NFT market capitalization is $17,9 billion and it doesn’t seem to stop growing. But are we nearing the peak in terms of token popularity, or will we see an even bigger surge very soon?
While we don’t actually possess extrasensory abilities to predict the future, we are willing to dive into the concept of NFT right now in order to analyze the possibilities of this technology and figure out what can be tokenized in the sports industry at the moment. Without any further ado, let’s get the ball rolling!
What is an NFT?
NFT stands for non-fungible token and represents a unit of data stored on the blockchain. Unlike Bitcoin and other cryptocurrencies, each token here certifies that a digital asset is one of a kind and therefore cannot be replaced with anything else.
NFTs became technically possible when Ethereum, one of the leading blockchains, added support for them as part of the new ERC-721 standard. This is the main reason why the vast majority of NFT tokens have been created using the Ethereum blockchain platform.
The NFT first went mainstream in 2017 when CryptoKitties entered the world. It is certainly not news that people are crazily in love with cats, but such an obsession with digital kittens may still be surprising to some. CryptoKitties is a virtual blockchain game created by Dapper Labs that allows players to adopt, raise, and trade virtual cats. Each kitten is unique, 100% owned by the player, and cannot be replicated, taken away, or destroyed.
Although CryptoKitties were also built on the Ethereum blockchain, the network quickly became congested and couldn’t meet the high demand of NFT enthusiasts. As a result, developers decided to create their own blockchain, which would be easier to scale and allow them to reduce the cost of transactions. Thus, they have developed Flow and their own programming language called Cadence, and CryptoKitties are currently in the process of switching from Ethereum to Flow.
The Flow blockchain has become another option for building decentralized applications, especially those related to NFTs, games, and digital collectibles.
Since then, a lot has happened and NFTs have transformed from a niche hobby into a real global obsession. Nowadays, an NFT can be used to represent artwork, concert tickets, social media posts, photos, GIFs, videos, audio, and other things that you could never imagine being tokenized.
What is the difference between Ethereum and Flow blockchains? Click here to find out!
The value that NFTs represent to sportspeople and their fans
Any fan, no matter if they admire a music band, a football team, or Harry Potter books, loves to collect merch and memorabilia and won’t miss the chance to get to a Meet & Greet, a concert, or a match (as soon as the pandemic is over). Thus, it’s only natural that dedicated fans and collectors are so into NFTs.
The NFT concept sounds like a perfect fit for the sports industry. The NBA is well aware of this: their NBA Top Shot platform has generated $500 million in sales and over 800,000 users since the start of the public beta phase in October 2020.
NBA Top Shot is a blockchain-based trading card system where basketball fans can purchase, sell, and trade officially licensed video highlights (“moments”) with their favorite players.
Benefits for fans
Let’s say you bought an NFT that has Michael Jordan’s slam dunk attached to it. What will you gain from this purchase?
By acquiring this moment from NBA Top Shot, you don’t really get the copyright to it and can’t use it outside the blockchain. Moreover, the token cannot be borrowed or divided into parts. The buyer can only do what is allowed by the moment’s owners, in this case, the NBA and Dapper Labs.
Now you might be wondering why such platforms are still THAT popular and are attracting more and more fans. This is a very logical question, and the answer is that you can buy and keep moments in your collection knowing that you’re the only one with the official version of the highlight.
Generally, we can easily download the files we like, often for free, but their exclusivity carries the main value. Blockchain records and securely stores the information that it was you who acquired a certain item, and also keeps the data about the item creator. For fans and collectors, such purchases are akin to purchasing writer’s manuscripts or original paintings.
Fans can also see NFTs as a form of investment: they can resell tokens and earn money from them. For some, having a unique NFT backed by a real item is a joy and an unforgettable emotional experience as well.
Benefits for athletes
NFTs offer a new monetization model that benefits athletes and their fans even more than advertising or sponsorship. It is also a new way to connect with fans and provide them with a unique experience such as giving them a chance to buy one-of-a-kind items, photos from personal archives, and even a ticket to an in-person meeting.
Indeed, today we are seeing a generation that values digital assets as much as physical ones, so it shouldn’t be surprising that people are eager to buy digital photos or GIFs instead of downloading them for free, especially when they know that they’re owning something exclusive.
What defines the collectible card business, for example, is the physical scarcity of cards. The idea of scarcity combined with authenticity is what attracts fans the most and helps athletes get closer to them.
Moreover, launching an NFT project is another marketing opportunity for leagues and athletes. Just like they sell official league- and team-related merchandise, they can also create NFTs and treat this as another kind of eCommerce, only with a lot more potential applications.
All in all, NFTs are a win-win innovation for both athletes and their fans.
Why are NFTs so expensive and growing in price?
When a collector buys an incredibly expensive stamp, painting, or coin, we may wonder why people willingly pay such unbelievable money for these things. However, this has become the norm because we’re now accustomed to the thought that original, unique, and famous physical items are worth a lot and can later be resold for even bigger sums.
Authenticity, uniqueness, rarity, and popularity make any item extremely valuable and therefore expensive. In the case of NFTs, nothing changes, except for the technology and way of storing information about the authenticity and purchase of a product.
Since NFTs are based on blockchain technology, the latter allows you to check and verify the authenticity of the item, which increases its value. Thus, fans and collectors can buy original (mostly digital) items without leaving their homes and they don’t run the risk of accidentally buying a fake product.
Today, artists, celebrities, actors, and athletes tokenize their paintings, songs, collectible game cards, and even tweets, not only to earn money but also to protect their copyrights. For example, if you buy a video clip, you don’t receive the broadcast rights for that clip or a physical copy of it. In fact, the buyer owns a few lines of code, but they are proof and a kind of digital certificate that they’re the owner of the unique digital asset.
If the NFT includes a personal meeting with a famous athlete, a ticket to a match, or a Meet & Greet, then the value of this token will, of course, also increase.
NFTs in the sports field: what do we tokenize?
Many athletes, celebrities, and influencers have set their sights on the NFT hype and would like to be a part of it too. When it comes to the sports industry, statistics collected from NFT marketplaces on the Ethereum blockchain show a fairly large number of sales made just within a month, from April 15 to May 15: a total of 52,752 tokens sold, with $11.4 million spent on completed sales. Impressive, right?
Let’s find out what exactly leagues and athletes can turn into non-fungible tokens and how they can ride the NFT wave.
Games and collectible cards
As a league or team, you can choose to build your own marketplace that will serve as a platform for offering your sports club’s exclusive collection of NFT cards. Alternatively, you can create an online game in which NFT cardholders play against each other or team up and host virtual competitions.
If an athlete would like to issue collectible game cards, they can arrange a special photo session and place exclusive photos on them. Another idea: they can issue cards featuring highlights of their career. All cards must have different images on them and be unique.
Sorare: a virtual game with collectible cards
Sorare is a prominent example of an NFT virtual sports game. This Ethereum-based fantasy soccer game was developed by Nicolas Julia and Adrien Montfort in 2018. The platform has partnered with 138 officially licensed clubs, including FC Bayern München, Liverpool FC, AC Milan, Real Madrid CF, Valencia CF, and other world-famous soccer clubs.
The Sorare game allows its players to create teams, earn rewards based on real soccer fantasy league scores, and also buy, sell, trade, and manage their virtual teams using digital player cards. Some of them are licensed digital collectibles which can be rare, super-rare, and unique.
Check out this blockchain platform that lets football clubs provide a personalized experience for their fans
Video clips and GIFs
When we think of an outstanding athlete, we often recall the highlights of their career or famous pre-game rituals such as LeBron James’s chalk toss. Imagine that these unique moments could be converted into high-value NFTs and end up in a fan’s digital collection.
NBA Top Shot: digital cards with highlights
The idea of issuing NFTs with highlights has already been implemented in the NBA Top Shot platform. Here’s how the process goes: first, the NBA cuts the moments, and Dapper Labs, the platform developer, decides which ones they’re going to sell. Then they put each highlight into digital packs and sell them on the website.
The cost of every moment depends on the quality of the video, the player’s stardom level, and the exclusivity of the card. Once a fan buys a pack, these videos go into their wallet for “showcase” or they can resell them on the NBA Top Shot Marketplace.
SportsIcon: NFTs with iconic moments
Another NFT platform SportsIcon has recently completed a funding round led by former NBA champion Andrew Bogut and Roham Gharegozlou, CEO of Dapper Labs. YouTube creator and former CEO Chad Hurley was on the list of investors as well. SportsIcon plans to partner with a variety of athletes to develop NFTs of iconic moments from their sports careers. NFTs will be attached to existing footage as well as exclusive content created by athletes and digital artists.
Photos and personal files
An athlete or a team can choose photos from their personal archives that have not been previously published on the Internet and convert them into NFTs. These can be photos from childhood, early training days, performances, or a first football match. This gives the token value and exclusivity for fans and other potential buyers.
Good news for sports photographers – you can sell your work as an NFT and still retain copyright and reproduction rights. Even after the photo is sold, you can continue to show it on social media, sell prints with it, and so on.
LeBron’s picture as an NFT
OpenSea, one of the largest NFT marketplaces, hosts thousands or even millions of dollars worth of rare digital items and crypto collectibles. For example, as of May 17, 2021, the “Statue of LeBron” is worth 10,000 ETH (more than $35 million) here. The photo was taken in February 2020 and is authentically minted by photographer Kimani Okearah. If the photo finds its buyer, they will be granted exclusive non-commercial rights to the one available copy of the photo and its raw file.
Famous athlete memorabilia such as sports equipment, trophies, outfits, and accessories can become NFTs. You can create a marketplace for your team or join existing ones, place any kind of belongings there, and share them with your fans.
In addition, you can collaborate with the designer to recreate tickets for major sporting events and sell their unique digital copies as NFTs.
Warriors’ collection of rings and ticket stubs
San Francisco-based NBA team the Golden State Warriors have done just that; they have released their own NFT collection of limited edition digital versions of championship rings and ticket stubs. “You saw the games, you celebrated the Championships. Now own a piece of history,” tweeted Warriors.
The NFT collection consists of Warriors Championship Ring NFTs and Commemorative Ticket Stubs NFTs designed by artist Black Madre.
Warriors didn’t stop at just selling their collectibles, but decided to reward their fans with an exceptional experience. The bidder who purchases the first edition of each ring will receive a corresponding physical Warriors Championship Ring. If a fan buys all six NFT rings and completes the entire set, they will unlock a Warriors Championship Banner NFT.
As for the ticket stubs, the highest bidder will take part in a Warrior-for-a-Day event that includes the opportunity to sign a mock one-day contract with the team and receive tickets for two to the Warriors home game. Fans who buy all 10 ticket stubs and collect the whole set will unlock the Warriors Historic Moment Showcase NFT.
Basically, it’s memorabilia + making amazing memories that fans will never forget.
Meet & Greet, online or in-person meetings
Getting to a Meet & Greet or any other meeting, online or offline, is the ultimate dream for every fan. Meanwhile, for an athlete, this is a great way to interact with their fans and pay them back for their support.
If you would like to hold a Meet & Greet – a meeting with a group of your supporters (up to 15 people), you can issue NFTs that will serve as tickets for this event. These NFTs cannot be copied or exchanged, so sports fans will have a unique chance to participate in a meeting where they can ask their favorite athletes questions, chat, and take pictures.
The same goes for online and in-person exclusive meetings. An online meeting is not the most preferred option for fans, of course, but during the global pandemic, even an experience like this will make athletes and their fans much happier. Sportspeople and exclusive token owners can communicate via Skype, Zoom, or other applications.
In addition, guest passes and show openings can also be tokenized and presented on marketplaces.
Gronk’s collection with a meeting attached
Rob Gronkowski (aka “Gronk”), American football tight end for the Tampa Bay Buccaneers of the NFL, has launched his own Rob Gronkowski Championship Series NFTs. His collection on the OpenSea marketplace is dedicated to Gronk’s four historic сhampionships and includes five limited-edition NFT collectible cards. Each card is a unique item, digitally signed and numbered by Gronk himself.
The real diamond of this collection is a rare 1-of-1 Rob Gronkowski Career Highlight Refractor Card. Whoever buys it will get to a Meet & Greet with the footballer and receive tickets for a game next season.
Gronk’s blockchain-based collectibles were unveiled in March 2021. His collection generated over $1.6 million in revenue, with all NFTs representing verified digital ownership of each of the 349 cards being sold out.
NFT for charity
Famous athletes can issue various NFTs and donate the proceeds to charity organizations and those in need. This is a win-win situation from all angles: NFT collectors and sports fans can acquire the desired items, while the most vulnerable members of society can receive significant help.
Ethernity Chain and Pelé’s charity campaign
Ethernity Chain is arguably one of the best examples of a blockchain-based charity initiative. This Ethereum-based platform helps athletes, artists, and other creators issue limited edition authenticated NFTs (A-NFTs) and collectible cards, allowing them to be rewarded and raise money for charitable causes.
Let’s say you would like to purchase a $100 collectible card. In this case, up to 90% of the sum, or $90, can be donated to charity, and about 5% – the cost of the transaction, and another 5% – will go to the Ethernity Chain platform.
Ethernity Chain recently released the officially licensed collection of Pelé’s A-NFTs – the first time this famous soccer player’s collectible cards have been released digitally.
“Thank you so much for caring, Ethernity Chain. The proceeds from this initiative will go to the Pelé Foundation and will help many people,” tweeted the soccer legend.
As a result, Pelé’s NFT collection raised $750,000, and 90% of NFT sales will go to the Pelé Foundation, a charitable organization that empowers and educates children fighting poverty around the world.
And even more options for tokenization!
As more and more athletes and celebrities join the NFT world, the number of options in terms of what can be tokenized and sold as NFTs has been increasing, too.
You thought that was all? Certainly not! We will continue and briefly introduce you to other ideas for NFT potential applications.
Today, the small favor of giving an autograph can offer a fan much more than just the pleasure of owning it. In terms of non-fungible tokens, sportspeople can create personalized NFT autographs addressed exclusively to their most dedicated supporters. Later, the fans may consider these digital autographs as an investment, or keep them in their priceless collections.
Avatars, stickers, and emojis
Athletes, sports teams, and leagues can turn to a graphic designer to create cartoon avatars, stickers, and emojis that can also be animated. Once tokenized, they can be purchased by sports fans in NFT form.
Drawings, paintings, and animations
To popularize the NFT market and promote their own team or a brand, an athlete can create original drawings, paintings, or animated pictures. When it is made with your hands and is one of a kind, it will be of high value and in demand.
Quotes and social media posts
Even quotes can become NFTs, but they should be bright and memorable. The athlete’s quote may also be accompanied by a photo/GIF/video clip from the personal archive. Thus, the token will represent a unique and rare digital item that fans will be willing to buy. Social media posts can be traded as NFT tokens as well. The owner of such a token gets the right to own the post.
Tickets and packages
A unique NFT ticket will serve as a pass to all sorts of events, from attending the games to visiting the stadium during rehearsals and training. Fans can simply purchase an NFT ticket, but that can be quite stressful as only the fastest buyers will get one. Another option: tickets can be put up for auction. In this case, the highest bidder will acquire the pass to a certain event.
Leagues, teams, and athletes can also choose to sell NFT packages. Here, several NFT products will be combined in one set, for example, an autograph + a photo with an athlete, collectible game card + in-person meeting, memorabilia + online meeting, and so on.
The options for minting NFTs do not end there, as generally any idea a sports team or individual athlete has in mind can easily be brought to life.
Want to know even more about how NFTs work? Read this article to get all your questions answered
The NFT market is evolving extremely rapidly. Currently, we are witnessing a real boom in NFTs, as many famous athletes, celebrities, artists, and designers from all over the world have joined the wave.
These days, NFTs provide a way for athletes to promote their own names and unlock new opportunities and ideas for interacting with fans. For sports fans, this is a chance to get their hands on digital collectibles and unique physical items, and even meet their most admired sports star.
Although NFT is still a very “young” technology, it already looks very promising as it provides athletes and creators with advantages they could never have thought of before. Since the NFT craze doesn’t seem to be slowing down, it would be very regrettable to drop the ball and not consider giving NFTs a try.
We at PixelPlex are not newbies who have just started playing on the NFT sports field. With extensive knowledge and experience in blockchain technology and the development of non-fungible tokens, we are willing to help athletes, sports teams, and innovators who are looking to start their NFT journey.
Contact us and we will be ready to offer you a range of tokenization solutions and help you customize NFTs for special events and occasions. We will make sure you implement an NFT project that will bring joy to your team and fans!