Cryptocurrency in sports might have sounded bizarre a couple of years ago, but since the space of blockchain and digital currencies has expanded so much lately, today is only normal to hear about such concepts.
One of the freshest trends in the crypto industry is sports sponsorships in baseball, UFC, Formula 1, and football. Sports leagues and clubs around the world are turning to cryptocurrency to increase fandom and engage with their fans. However, there is a good reason behind this bold move. The sports industry has experienced significant transformations lately, and the events of 2020 were just the last straw. With less ticket revenue for live events and the surge of the digital-native fan, both sports and esports industries felt forced to find new and brilliant ways to engage fans and try alternative revenue streams while staying away from corruption and fraud. This is where new-age technologies have come into play. Blockchain, in particular, has been a game changer for the traditional sports industry. Blockchain use cases in the sports space vary: it has enabled teams and leagues to strengthen their fan relationships and also unlock new profitable revenue streams. Sports companies have also taken advantage of cryptocurrency sponsorships like Bitcoin, Dogecoin, and Shiba Inu. Binance, the largest crypto exchange in the world, is used not only to buy Ethereum or other virtual currencies – but it’s also known for several deals in the sports space.
So, there’s no doubt anymore: blockchain and cryptocurrency do exist in sports. More about this you can find below:
Notable Sports Clubs That Leverage The Technology
Some notable sports clubs and leagues are already using blockchain and cryptocurrency to engage with their audiences. In February 2022, for example, Manchester United F.C. made its sponsorship deal with Tezos public, specifying that it’s worth $27 per year. Based on declarations, the soccer team’s warm-up shirts will show off Tezos’ branding.
In Formula 1, a number of teams are sponsored by cryptocurrency projects, among which Alfa Romeo F1, Scuderia Ferrari F1, and Scuderia AlphaTauri are the most notable. Blockchain and crypto projects like Floki and Fantom are supporting these teams, making both parties a huge favor.
As previously mentioned, the Binance exchange has also made some notable deals in the sports industry, including the sponsorship of the Argentine Football Association (AFA) and the aid of TotalEnergies Africa Cup of Nations (AFCON 2021). It also teamed up with Alpine F1 team to develop a reliable platform for fans to indulge in non-fungible tokens (NFTs). Italian football club Lazio also benefits from Binance’s support as regards its fan token platform.
And things don’t stop here. The sports club Manchester City F.C. has created the world’s first football stadium based on metaverse technology to help football enthusiasts attend matches in an online environment. New synergies with the crypto space are finding their way through. Thus, sports teams make use of the so-called fan tokens to build robust fan relationships. However, fan tokens are so much more than that. These currencies tied to certain leagues or teams have been implemented to exchange league-related value, including voting on league matters, purchasing tickets, and giving discounts on merchandise. Other big names that have adopted fan tokens include AS Roma, Juventus, AC Milan, Paris Saint-Germain, F.C. Barcelona, and Atlético Madrid. Fan tokens seem to be fruitful, as fan engagement, especially as regards young people, has increased considerably. Nonetheless, enhanced awareness is probably this initiative’s most significant advantage.
Rewarding Fans On Engagement Sites
As previously mentioned, blockchain has been used to create fan engagement sites. Sports clubs and teams leverage this technology to build loyalty programs, and in order to do so, they reward fans for supporting and sharing their content. These rewards, in turn, can be used to buy various digital collectibles, sports tickets, and merchandise. However, these platforms play a role that exceeds the material value. They serve to promote a feeling of belonging and community among fans while strengthening the league’s connection with partners. That’s due to the open nature of blockchain, which allows for transparency, seamless sharing of fan engagement data, and, of course, increased ROI.
Boosting Shareholder Confidence In E-Sports
Numerous investors, including the media, players, team management, sponsors, and game developers, put their money into esports. This requires a lot of transactions, which necessitates, in turn, information sharing and resharing for every side. Intermediaries are crucial in this regard, as parties can’t handle such vast amounts of information. However, centralized systems have proved a bit inefficient when it comes to this kind of business, sometimes leaving room for uncertainty and taking so much time to validate transactions. That’s why there’s a need for technologies with decentralized nature, such as blockchain. This provides a single platform to perform all transactions and data sharing so that all parties interact with ease and transparency. With the rise of smart contracts, this is likely to happen even more effectively, as contracts allow for a smoother procedure for transferring players media rights or prize money.
Trading Cards For The Digital Age
Trading cards have long been profitable for sports teams and leagues. However, this needs to change as a new generation of fans is emerging: digital-native fans who aim at digital collectibles. In order to thrive and keep up with the market’s needs, sports clubs and leagues need to rethink their digital strategies. Fortunately, a good number of such companies have introduced digital trading cards and souvenirs that supporters can purchase and swap as they wish. Crypto collectibles based on blockchain technology allow clubs to create unique or limited-edition digital goods that can be verified via a transparent and incredibly secure ledger. Not only does this lure fans, but it also enhances profits.
Sports clubs and leagues have started to consider blockchain and cryptocurrency for both marketing and community engagement purposes. Big names like Manchester United F.C., Alfa Romeo 1, and F.C. Barcelona are already in the game, so the power of this technology is no longer questionable. In the future, the industry may expand even further, so expect many other sports giants to join the crypto initiative.