NFTs have been taking the sports industry by storm. From Lebron James to Serena Williams, everyone is getting a piece of the pie. Thanks to the underlying technology of NFTs it is bringing some much-needed innovation to the space.
That is why in the article, I will be going highlighting this innovation and much more. So without further ado, let’s jump right in.
What are sports NFTs?
Sports NFTs work like any other NFTs. In essence, they are unique assets stored on the blockchain which cannot be faked or duplicated. In other words, you can think of them as digital receipts stored on a public database. Every transaction on this database is open to the public and permissionless and each NFT is tied to unique metadata. In the case of sports NFTs, this may be trading cards or tickets to enter games.
What’s the big deal?
They reward fans– firstly, sports NFTs are providing a true community experience. Ultimately, they are changing the dynamic between clubs and fans. Now fans can truly be rewarded for their support. For instance, by attending certain games you could get rewarded exclusive NFTs.
One example is trading cards which can then be traded on the open market. Not to mention they are used as status symbols and shown off within the community. This creates an active fan engagement network which fosters a sense of community.
The commodification of historic moments – this can be seen as both positive and negative, but now historical moments can be turned into NFTs. Think of England lifting the 1966 world cup, this video clip could be turned into an NFT. This moment is preserved in digital form and fans can own and trade it.
Guaranteed Authenticity – thanks to the underlying technology of NFTs sports memorabilia can now be verified on the blockchain. This information is completely transparent and open to the public which highlights any malicious activity and guarantees authenticity. The days of fakes are now gone.
Royalties – royalties present a unique opportunity for clubs and athletes. Essentially, they can be hard coded into the smart contract so that every time the collectible is sold they get a cut of the profit. As the popularity of the collection grows so will their returns. Want to learn more about royalties? read my previous article.
Efficiency – the improved efficiency is outstanding. As everything is verifiable digitally no paperwork is needed. Not to mention there is no arduous grading process. This also eliminates the need for an intermediary, there is no middleman to take a cut of the profit. Trading is done peer to peer.
Avoids physical depreciation – as sports NFTs are digital they don’t decay over time. This is especially important for memorabilia. Now they are preserved forever. Not to mention, this makes the grading process redundant.
Digital Tickets – NFTs can also be used as tickets. Essentially, the record on the blockchain acts as proof of purchase. As this technology is truly open it cracks down on any malicious activity. In an industry notorious for ticket scams this is great. Not only that but being digital minimizes the chances of fans losing tickets.
Fractional ownership – there is no denying that sports memorabilia can get ludicrously expensive. Oftentimes every day fans are priced out. But with the advent of NFTs and fractional ownership, this can now change.
Essentially, fractional ownership splits NFTs allowing you to own a percentage stake. When fractionalized, the original NFT is locked and then a smart contract splits the asset into tokens. These tokens are traded on the open market.
This lowers the price of entry as you don’t have to buy the full asset. If you want to learn more about fractional NFTs, click here.
Promotion – all these factors can also benefit creators. With the buzz surrounding NFTs this can bring positive attention. For instance, it can facilitate brand awareness and promotes engagement.
Sports NFTs can be found on any of the major marketplaces. This includes:
OpenSea – this is the largest NFT marketplace by far. It has a strong reputation in the industry going back to 2017. Founded by Devin Finzer and Alex Atallah it is a behemoth with over 80 million NFTs.
Overall, it features a user-friendly design with support for over 130 different payment methods. Setting up an account is free and all the major wallets are supported. Finding sports collectibles is easy as you can simply filter by category.
Magic Eden – this is another great option that is cheap and fast thanks to the Solana blockchain support. Not only that, but marketplace fees are just 2% which is significantly lower than the competition.
Artists are also supported by the “launchpad”. This project helps launch new NFT collections with Magic Eden staff looking over smart contracts for bugs and weeding out any shady projects. They also provide general support and answer any queries. So if you’re looking to launch a new collection it is worth applying.
NBA Top Shot – this is a huge project with a market cap in the hundreds of millions. Officially licensed by the NBA player association, this platform features a marketplace where users can buy and sell “moments”. These moments are in the form of short video clips such as famous slam dunks or assists.
As you can see Sports NFTs are bringing so many new benefits to the sports industry. The whole dynamic of sports communities has shifted. Now fans and clubs can develop a mutually beneficial relationship. Ultimately, the trading of NFTs creates a more active community and generates revenue in new ways.
Not to mention, the benefits that the technology brings. From authentication to royalties, it is truly impressive. In my opinion, this will only get better as technology continues to grow. I hope you found this article interesting and thanks for reading.
Want to learn about NFT floor prices? Click here to read my previous article.