How does a Sports NFT Work?
If you are a sports fan or a sports organization, you may have lots of questions about sports NFTs. What are they? How do they work? Let's take a look.
If you are a sports fan or work for a sports organization, you may have lots of questions about sports NFTs. One of the fastest-growing segments of the sports memorabilia market, a sports NFT is a collectible with huge potential to turn even casual enthusiasts into rabid fanatics.
But what IS a sports NFT?
You might think about NFTs as a high-tech way to buy digital art or other digital assets. And you aren’t wrong. Non Fungible Tokens are excellent ways to buy limited edition art, or digital collectibles in video games. The NFT market is full of NFT projects that creators and brands are turning into revenue streams.
But an NFT can be so much more than a certificate of ownership for digital art. When used to their full potential, sports NFTs can be big business. According to Market Decipher, “research estimates the Sports NFT Market size at $2.6 billion in 2022 and forecasts to reach 41.6 billion by 2032.”
By harnessing the potential of the sports NFT, companies and teams are finding new ways to engage with their fans.
The NFT sports collectible
Combining the appeal of trading cards with the technology of NFT art, sports organizations are finding great success with the NFT sports collectible. Some teams are offering limited edition NFT-based artwork or photos that are very similar to traditional trading cards in digital form. But like all NFTs, these can be sold in secondary markets that ensure the original creator receives ongoing royalties for years to come.
Other organizations have found more unique types of digital assets to offer. NBA Top Shot, for example, allows fans to buy special edition video clips from their favorite teams or players. The value of these officially-licensed digital assets varies based on their overall scarcity.
And some organizations are utilizing NFTs and blockchain technology as digital proof of authenticity for physical collectibles (like game-used balls or jerseys) or autographs.
The NFT sports experience
Another type of sports NFT is the experience. Some organizations let fans buy access to events and activities that are exclusive to NFT owners. Doing this involves taking advantage of blockchain technology to generate one-of-a-kind proof of purchase that can be easily verified.
There are unlimited options for an NFT-based experience, ranging from exclusive fantasy sports league access to in-person events such as batting practice, meet-and-greets, and more.
PriceWaterhouseCooper’s managing director for sports (and former Cleveland Browns CFO) Mike Keenan told Boardroom that in the near future, “NFTs related to tickets and memorable events will become commonplace. We’ll also see a lot of new and better use cases for NFTs, with utility added in the form of access, voting rights, exclusive events, and more.”
The sports NFT membership
Finally, many teams and operations are finding clever uses of sports NFTs in building a fan membership program. Think of these as combining the experience model mentioned above with the old-school fan club. Here, sports NFTs are being used as access passes to hyper-exclusive offerings that may include
- Stadium access
- Members-only events
- Training camp access
- Club-level bars or restaurants
The Dallas Mavericks, for example, have found a way to use NFTs to engage fans by offering a free NFT to every fan with a home game ticket–and also an account with the team.
This means that every fan who redeems their free NFT will need to provide the team with contact information that can then be used for marketing and other activities. Those NFTs can be traded or sold by the fans, with the smart contract providing that same type of information to the team’s marketing office.
Why sports NFTs?
As we explained above, sports NFTs can be big business. Market Decipher explains “Currently, major sports in demand for NFTs are NFL, Soccer/Football, Basketball, Baseball, Cricket, and Ice Hockey. Over time, however, all sports are likely to have some form of NFT offering. Interest in sports NFTs is likely to be spurred by activity in the wider NFT market, including that for digital art.”
But to get involved, you need a partner with some expertise. That’s where RareCircles comes in. As we discuss on our website, “RareCircles enables sports franchises to unlock new layers of fandom with a powerful suite of tools and easy-to-implement integrations.”
Learn more about our sports NFT solutions, or join our NFT Masterclass today!
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