Are NFTs beneficial for athletes in the realm of sports?

Cristiano Ronaldo is currently facing a $1 billion lawsuit for promoting Binance NFTs, which has brought attention to the interaction between sports personalities and NFTs. NFTs have evolved from being exclusively linked to virtual currencies to encompassing various real-life assets such as films, toys, and games. However, sports NFTs have particularly stood out in the industry as collectibles and memorabilia. In early 2021, NFL superstar Rob Gronkowski introduced a collection of Super Bowl Cards, marking the beginning of sports NFTs gaining popularity. A report by METAV.RS’s NFT market revealed that 35% of e-sports enthusiasts expressed interest in collecting NFTs for enjoyment or potential financial gains. Additionally, 20% showed significant enthusiasm. Despite their popularity, sports NFTs have faced criticism from regulators and industry players. The English Premier League faced criticism from the Football Supporters Association for collaborating with Sorare. However, the rise of NFTs in sports has had a significant impact on personalities and entities within the industry.

Sports NFTs are distinct digital assets created on a blockchain that represent various elements within the sports industry, such as player cards, team memorabilia, and iconic sports moments. These assets are available on NFT marketplaces like OpenSea. Professional athletes, whose careers typically last five to seven years, have increasingly turned to NFTs to leverage their highlights, merchandise, and royalties from sales. For fans, owning an NFT sports collectible offers a unique piece of history and holds great emotional value. Fan tokens, another form of digital assets, give sports fans a tokenized share of influence over club decisions and access to exclusive rewards and experiences. The market cap for fan tokens has exceeded $300 million, and the technology has been adopted by networks like Polygon to develop NFT ticketing platforms.

Sorare, a card trading marketplace and NFT fantasy sports league, has gained significant popularity since its launch in 2019. The platform allows players to collect NFT player cards and compete in fantasy leagues based on competitions like La Liga, Premier League, NBA, and Bundesliga. Sorare currently holds the 10th position in all-time sales volume among NFT collections, with $734 million. However, the platform’s partnership with the English Premier League faced backlash from football support groups, leading to inquiries from the UK Gambling Commission regarding operating licenses. The rise of sports NFTs can be traced back to the release of Gronkowski’s collection, which was followed by the Golden State Warriors’ team collection. Although the sports NFT market did not achieve impressive numbers in 2023, analysts predict increased trader attention in 2024. The sports trading cards market reached a valuation of $14 billion, while the sports memorabilia collectibles market reached $32 billion.

Many sports personalities and athletes have embraced NFTs, including Serena Williams, Michael Jordan, Stephen Curry, Shaquille O’Neal, and Neymar Jr. These digital assets have become popular since 2021. Tom Brady, a seven-time Super Bowl winner, launched an NFT platform named Autograph, which allows celebrities to sell NFTs to their fans. His collection of 16k Tom Brady Origins Collection NFTs reportedly sold out in 10 minutes. Lionel Messi, an eight-time Ballon d’Or winner, also released an NFTs collection in partnership with Ethernity, with one rare piece resold for over $9 million. However, these athletes have faced criticism for their association with NFTs and digital currencies, as some believe they are exploiting fan appeal for personal profit.

While NFTs offer athletes a way to interact with fans and provide exclusive access to experiences and merchandise, there are concerns about their involvement in the sports world. UK lawmakers raised issues about speculation on sport-based digital assets, which could pose financial risks to fans and damage the reputation of clubs. There have also been calls to discourage athletes from engaging in crypto advertising due to previous instances of fraudulent promotion. Cristiano Ronaldo’s lawsuit for promoting Binance and his “CR7” NFT collection has further intensified these concerns. Some argue that instead of fighting the growth of NFTs, global financial regulators should focus on establishing clear guidelines for overseeing the ownership and trading of these digital assets. The controversies surrounding sports NFTs may make more sports personalities cautious about getting involved, as they risk losing partnerships, sponsors, and the support of their organizations.