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SXSW 2024: Winmo’s Top Industry Takeaways
What a week in Austin. Despite the common skepticism about the festival’s relevance, SXSW showcased its adaptability and innovation, staying...
Last week, former Clemson University quarterback Trevor Lawrence was selected by the Jacksonville Jaguars as the top overall pick in the NFL Draft. Then, the 21-year-old wunderkind with my exact haircut used his signing bonus to invest in cryptocurrency. Lawrence partnered with Blockfolio, a crypto investment app, to invest his almost $23M signing bonus in bitcoin, ether, and yes, dogecoin.
For those of us who need a refresher on the definition (me), crypto is a digital currency that can be used to buy goods and services. So, Internet money. It uses an online ledger with strong cryptography to secure transactions. Interest in these unregulated currencies is often to trade for profit, with speculators driving prices.
Cryptocurrencies and blockchain technologies can monetize fan engagement, attract sponsors, and engage the global sports market. When teams understand their fans as whole people they can foster strategic partnerships that unite interests. Cryptocurrency is capable of revolutionizing revenue streams and the fan experience.
Many cryptocurrencies have already announced their sports sponsorship deals:
- Coinbase: The cryptocurrency exchange signed a sponsorship deal with esports tournament organizer BLAST Premier, promoting their branding across spring and summer events.
- FTX: Another exchange, FTX secured the naming rights to the Miami Heat’s arena. Paying $135m for a 19-year deal, it’s the most high-profile sports sponsorship by a crypto company.
- eToro: The crypto-trading service partnered with several Premier League teams – paid for entirely with Bitcoin. By September 2020, the platform was one of Europe’s biggest football sponsors of clubs such as Tottenham Hotspur, Brighton & Hove Albion, and Cardiff City.
- Crypto.com: In March, Aston Martin Cognizant Formula One partnered with the exchange platform (which has 10M+ active users), becoming the first Formula One team to partner with a cryptocurrency firm.
NFTs are gaining momentum in sports, too.
An NFT is a digital asset that represents real-world objects like art, music, memes, and videos. They are bought and sold online and are encoded with the same software as many cryptos, too. Stored in digital wallets, NFTs are not interchangeable and each represents a unique digital item like collectible baseball cards, virtual real estate, and even digital sneakers. This is a huge development for the trading cards and collectibles industry. Fans can own a moment in sports history with tools like:
- NBA’s Top Shot: The blockchain-based trading card system, provides NBA-licensed digital items with $230M in sales. The service lets users buy and sell clips of top basketball players, each unique highlight reel coming with a verified serial number.
- Sorare: In 2019, the Ethereum blockchain-based fantasy football game partnered with the Belgian First Division football league. Sorare’s platform allows gamers to buy and sell digital limited-edition football cards. Collectors can trade player cards, build teams, and earn rewards based on real performances.
Moving forward, sports companies ready to take a chance could see cryptocurrency sponsorships as profitable revenue streams. Again, research shows a significant overlap between the “typical” sports fan and blockchain enthusiast – male Millennials and Zoomers. Beyond traditional sponsorship opportunities like stadium branding, there’s endless opportunity for experimentation like crypto-payment at events, NFT creation, and digital gaming, too.