Non-fungible tokens, or NFTs, are starting to dominate crypto markets. This much is evident in NFT sales which are forecasted to grow to $75 billion by 2025. Although some Americans are still unfamiliar with cryptocurrencies and NFTs, 24% of U.S. households have reported owning at least one or both digital assets.
In the same report, data showed that the majority of crypto and NFT buyers are from younger generations, and the number of owners is significantly higher among sports enthusiasts, with 34% of them being sports fans and 57% of them claiming to be avid sports fans.
Looking at the available data we can see that NFTs in the sports industry have a lot of potential because people are willing to jump into the NFT market to back their favorite sports team or star.
Exclusive Fan Perks and Benefits
One of the biggest reasons sports enthusiasts are more likely to invest in NFTs is because some sports events offer exclusive NFT tickets or passes. These tickets give fans various benefits depending on their ticket tier while reducing the possibility of ticket forgery. One example is the Fanzone Sports Club, where NFT passes grant individuals access to international football teams’ activities on and off the pitch.
NFT passes are similar to fan tokens, which are also becoming increasingly popular in online sports communities, but instead of directly buying these privileges as with NFTs, fan tokens are traded or exchanged for exclusive access to several exciting club-specific rewards and membership perks. This includes private meetups and a chance to meet athletes and other famous sports personalities.
Lots of major sports teams like the legendary racing team Roush Fenway and the NBA’s Cleveland Cavaliers now even have their fan tokens, which can be bought, traded, and invested. Because of these once-in-a-lifetime opportunities, avid sports fans are in the market for both NFT passes and fan tokens.
Limited and Authentic Collectibles
In addition to unique fan experiences, NFTs are available in various forms of digital files for sports enthusiasts. If you’re familiar with basketball trading cards, NFTs also offer digital basketball trading cards in the form of NBA Top Shots. The trading cards include videos, photos, audio snippets, or other digital captures of historic moments. What makes them expensive and popular is that they are limited edition releases to ensure that they are exclusive and rare.
In the same CBS News article, NBA Top Shot creators, Dapper Labs, had doubled their annual sales to $700 million in 2020 alone from $361 million in 2019, and sports enthusiasts are still buying and trading them even though the NFT market has had some challenges of late.
Michael Levy is a huge basketball fan and he recently made a fortune by investing in the NBA Top Shot featuring American basketball player LeBron James. From paying $175,000 for his digital trading cards, Levy’s NFT collectibles are now worth over $20 million.
As NFTs continue to expand their reach in the sports industry, they will create new revenue streams for sports personalities and teams. Experts predict that sports-related token transactions in 2022 will reach more than $2 billion, and by the end of the year, around four and five million sports fans globally will purchase or receive NFT sports collectibles as gifts. It will also create a new avenue for sports enthusiasts to support and connect with their favorite sports team. Lastly, the metaverse will also pave the way for NFTs to be sold and traded in a virtual marketplace, making future transactions faster, more convenient, and more immersive.