- Cryptocurrencies see fast adoption in all spheres.
- Various sports brands are now getting associated with cryptos through crypto sports sponsorships.
- The crypto assets such as fan tokens and NFTs are developing new values for the sports industry.
Blockchain technology, along with the various forms of cryptocurrencies, is lately getting into all businesses. It is seen that crypto coins are widely getting acceptance from multiple sectors. Even the banks globally are slowly incorporating cryptos owing to its comprehensive benefits. The benefits are so much more than the disadvantages that the sports brands are entailing the incorporation of cryptocurrencies. It can be stated that crypto sports sponsorships are the new big thing at the moment.
This article will be all about how cryptocurrencies are getting into the sports industry and why they are widely accepted in this field. So, stay tuned until the end to know if and how cryptocurrencies will be the new fate of the sports industry.
How Sports Uses Cryptocurrencies & Blockchain Technology
Bitcoin and similar other cryptocurrencies are given immense importance and incorporated as the payment method in sports. Crypto coins permit the fans to buy tickets for their favourite sport, grab a couple of sports merchandise. Sports organizations also use cryptocurrencies to clear the fees of the players. Blockchain technologies have clearly offered advantages to sports clubs and organizations by implementing transparent ticket exchange markets with solid security.
Here are some of the many examples:
- In the early phase of 2018, a Turkish soccer club going by the name Harunustaspor stood as the world’s first soccer team to buy a player using Bitcoin (BTC). The bought player named Omar Faruk Kiroglu, aged 22 years, then received 0.0524 in Bitcoin (£385) and ₺2,500 (£470) in the deal with Harunustaspor.
- FIFA World Cup 2018 is another strong example where a couple of international payment service companies, including Epayments and Wirex, had permitted their fans to purchase tickets using Bitcoin. Ethereum (ETH) and Litecoin (LTC) were also allowed.
- In the same year, the Gibraltar United Football Club had partially cleared some of their players’ fees in cryptocurrency following a partnership deal closure with Quantocoin. Another striking fact in this regard is that Quantocoin simultaneously is a 25% shareholder of the Italian Serie C Football Club “Rimini FC 1912”. This football team became the first football club that a cryptocurrency firm ever purchased. Following this initiative, the Gibraltar government had imposed several new regulations permitting the businesses to be a part of the Initial Coin Offerings (ICOs).
- The latest update last year states that TIXnGO had partnered with Lancashire Cricket to offer a new blockchain mobile tickets platform. They worked with a reputed ticketing system provider, SecuTix. The deal had activated the secure mobile tickets for all of the international and domestic fixtures at the Emirates Old Trafford in 2020. In this, they focused on creating a unique encrypted ticket for the smartphone holders, which is traceable and thus removes the risk of counterfeiting tickets. It also ensures that the customers have a hassle-free experience with their purchases.
Partnerships and Crypto Sports Sponsorships
Sponsorships are not new but what is trending is the crypto sports sponsorships. These sponsorships are inevitable in increased awareness of cryptocurrencies amongst the investors and the viewers. At the same time, cryptocurrency has been continuously getting exposure via the media. A couple of the sports teams have expanded their advertising budgets for partnering with the upcoming and latest cryptocurrency exchange platforms. Here are some of the examples –
- The earliest example of such a kind had taken place in December 2014. A sponsorship deal was signed between ESPN Events and a US Bitcoin payment processor BitPay. This was the first cryptocurrency marketing initiative recorded. For promoting Bitcoin, BitPay had also sponsored an annual postseason football game for the US-based colleges. The game was named St. Petersburg Bowl.
- By 2018, the crypto sports sponsorships had started full-fledged when CashBet Coin was associated with Arsenal Football Club. CashBet Coin was the official blockchain partner of the club. The deal was devised for promoting the launch of the cryptocurrency platform’s digital coin, CashBet Coin.
- In the same year, Litecoin (LTC) was chosen as the official crypto partner of UFC 232. It sponsored the lightweight fight between Alexander Gustafsson and Jon Jones. This event eventually spiked interest in the digital asset, and Litecoin UFC received over 40 million Twitter impressions. It has grown to an audience of over 16 million users across the globe.
- Following this, eToro also aimed to promote its platform and partnered with various Premier League Teams where the transactions were entirely in Bitcoin. By September last year, the crypto trading platform had become one of the best football sponsors of clubs in Europe. These clubs included – Brighton & Hove Albion FC, Tottenham Hotspur FC, Crystal Palace FC, Cardiff City FC, Southampton FC and Newcastle United FC. eToro had also suggested that crypto coins can be used to purchase and authenticate merchandise, player transfers, and reduce ticket scams.
- The most recent record is of March 2021 where the very first Formula One team to partner with cryptocurrency platform (Crypto.com) was Ashton Martin Cognizant Formula One. The crypto.com sponsorship is really coming out bold.
What Is With The Fan Tokens & Crypto Assets?
The fan engagement tokens, also alternatively termed as the Fan Tokens, just evolved between the affinity of sports and technology. Fan tokens can be called the “fully fungible digital” utility token that offers its fans access as well as influence over specific decisions that their favourite sports team had put forward. The tokens provide its owner with the liberty to vote on the various club matters such as training ground names, kit designs, or even picking up the charity initiatives.
Sports related cryptocurrency is also introduced in this regard. One of the recent examples is the BAR token, one of the football crypto tokens Binance has introduced for Barcelona Football Club on the Chiliz Chain. It is a utility token and a Proof-of-Authority sidechain built on Ethereum. It is used for governance, rewards and has a provision for staking in future.
This might seem a little complicated, while it is not. How these Fan Tokens work on a specific platform has been put forward by the platform authority himself.
“And this is the point. Through Socios.com, we are tokenizing this emotional connection and a fan’s influence over their club. Ownership of Fan Tokens does not represent equity or shares in football clubs, and equally should not necessarily be viewed as an investment plan, but ownership does offer an entirely new way for fans to engage with their club or clubs. Moreover, ownership offers a place for a fan’s voice to be heard, and a place where their passion will be rewarded. Ultimately, owning Fan Tokens gives fans far more interaction, a greater voice, as well as more power and influence over the clubs they love, than just being a shareholder.”
Socios platform and a cryptocurrency Chiliz ($CHZ) provide fan engagement tokens or fan tokens strictly focused on e-sports. The Socios platform offers the fans an opportunity to vote on decisions like whom the football club plays while in the “friendlies”. Juventus and Paris Saint Germain have been established as the first two major football clubs to partner with Socios.com. Fortunately, a few fan tokens such as $JUV and $PSG are also listed on some prominent crypto trading platforms such as UpBit, Binance and Paribu. So basically, the fan tokens are created and distributed amongst the fans via the Fan Token Offering or FTO with a similar ICO concept. However, the fan tokens do not represent the ownership in the shares equity in the various sporting clubs even though they are very profitable.
Football Crypto Tokens List
Here is a list of cryptocurrency tokens or football crypto coin that has been created in association with football:
- Juventus Official Fan Token (JUV)
- Paris Saint-Germain Fan Token (PSG)
- Barcelona Fan Tokens (BAR)
- AS Roma Fan Token (ASR)
- İstanbul Başakşehi Fan Token ($IBFK)
- AC Milan Fan Token (ACM) – Upcoming
NFTs In Gaining Momentum Simultaneously
If you are not sure about what NFTs are, then here is a quick glance. The NFTs are digital assets representing real-world objects such as music, art, memes and videos. They are purchased and sold online while they are encoded with the same software as the other cryptocurrencies. NFTs are not interchangeable, and they are stored in digital wallets.
The fans looking forward to owning a moment in sports history can do so with specific tools such as the NBA’s Top Shot and Sorare. The former is the blockchain-based trading card system that offers the NBA licensed digital items with sales of $230 million. This service permits the users to buy and sell short clips of the top basketball players visible in a unique highlight reel bearing a verified serial number.
The latter permits the gamers to purchase and sell limited edition digital football cards. The collectors can buy these cards and trade them, build teams and even earn rewards depending on authentic performances.
With NFTs, there has been a steep rise in the crypto sports collectibles.
Crypto.com Is Making Headlines Again
It has already been mentioned that Crypto.com had associated with Ashton Martin Cognizant Formula One in March this year. Following this, the cryptocurrency platform has announced its multi-million-dollar sports sponsorship in just two weeks. In addition, it has also reported a $100 million sponsorship deal with Formula 1. The most recent one is the Ultimate Fighting Championship (UFC) that features wrestling in both the crypto sports sponsorships.
The sources have revealed that the deal is worth $175 million and is looking forward to standing for the next ten years. This means that this is probably the largest sponsorship deal for UFC to date. The brand will be promoting its name by featuring on the fighting kit components such as hoodies and shorts worn by the wrestlers when they are within the fighting ring. It will also feature the uniform worn by the training staff. In addition, Crypto.com will simultaneously own the rights to the new sponsorship category of UFC that has been dubbed as “Cryptocurrency Platform Partner”.
Some Other Renowned Crypto Sports Sponsorships
The ones already discussed above are not the only ones, and over 40 such sponsorships were reported. But here, we will talk about the most prominent ones which have not been covered in the initial half of the article.
BitPay Sponsorship With Kyle Busch Motorsports (February 2015)
In the BitPay sponsorship with Kyle Busch Motorsports, the crypto trading platform had stolen the opportunity to promote themselves rather than Bitcoin. This was the first-ever cryptocurrency sponsorship deal that involved a professional sporting organization. The U.S.-based NASCAR series motorsports team saw the cars adorned heavily with the logos of BitPay.
Assetereum Sponsorship With World Seniors Snooker Tour (February 2018)
This sponsorship seems pretty interesting as the cryptocurrency-based sponsorship was with a very traditional and conservative non-mainstream sport, snooker. It is, however, compared to the likes of motorsport and football. There would remain a question if this had something to do with Joe Johnson (former World Snooker Champion) as he was the adviser to the Assetereum board.
eToro Sponsorship With Seven Premier League Clubs (August 2018)
Social trading platform eToro, with the aim of promoting its trading service and cryptocurrencies in general, had partnered with seven Premier League Teams. The deal was estimated between £5-6 million, and that it was entirely paid in Bitcoin.
Antpool Sponsorship With Houston Rockets (September 2018)
This is the very first significant sponsorship that came along from the non-trading or gambling cryptocurrency brand. This involves a physical product. Antpool, along with its parent company Bitmain is engaged in manufacturing crypto mining equipment. In this case, instead of the machines, data centres and softwares that permit the new bitcoins to be entered into the crypto circulation and maintenance. However, Antpool sponsored with the basketball’s Houston Rockets happened to be a part of the more comprehensive $500 million investment that the firm made into Texas.
Knaken Sponsorship With Sparta Rotterdam (October 2020)
This was the first time that the cryptocurrency exchange platform Knaken had sponsored the Dutch first division football club. This sponsorship had to be included owing to its openness of the deal and creativity. It was mentioned that the football club had earned Bitcoins depending on its performance and that the amount was made publicly available. After the season got over, the Bitcoins were released for the club to sell whenever they wished to invest in their youth academy.
Upcoming Crypto Sports Sponsorships
The past sponsorships have already paved the way for new ones, and it is no longer that the headlines will hit with the latest occurrences. Here are a few of the upcoming cryptocurrency based sports sponsorships.
- The Sacramento Kings are bringing in NFTs for their fans in limited numbers at the Golden 1 Center for the California Classic basketball tournament. This will take place on the 3rd of August 2021 and the 4th of August 2021. So the NFT distribution will be amongst 100 selected fans. The fans can use these NFTs to purchase seats, foods, beverages, merchandise as well as digital art for commemorating the sport.
- Italian Football Club, AS Roma, has announced that they are about to partner with DigitalBits, an open-source blockchain network and Zytara Labs. DigitalBits will be the club’s new Main Global partner. The club describes the agreement to be the first of its kind bearing a worth of total €36 million. The partnership aims to merge the two worlds of soccer and blockchain. This was brought in order to offer innovative and unique opportunities to global supporters.
- Canadian Ice Hockey team, Montreal Canadiens or Habs, has partnered with the Hong Kong-based crypto trading platform Crypto.com. However, the financial terms of the deal have yet not been disclosed. Crypto.com’s publicly stated aim is to reach 100 million users by the end of next year and say they are confident about it. The cryptocurrency trading platform has also entered into a deal with the International Ice Hockey Federation (IIHF) for becoming its official cryptocurrency and NFT sponsor in the IIHF World Championship. The deal started this year itself with the world tourney in Riga, Latvia.
Cryptocurrencies are widely accepted in various fields, and sports is no different. In recent times, crypto sports sponsorships have been widely taking place and hence benefitting both the leagues and the crypto trading platforms for their exposure. Many sports clubs have also introduced salary payments and partnerships in cryptocurrency in collaboration with the cryptocurrency platforms. It has also been seen that developing countries are massively adopting cryptocurrencies. There would be even more industries, including the existing blockchain in sports, that will benefit from Bitcoin and other related cryptocurrencies in the coming future.