Times are constantly changing, with technology making strides in many directions and in many different fields—including sports. While sports collectibles have always been a stable part of the fan experience, allowing fans to collect valuable player cards, jerseys, photos, and autographed items, recent technology has enabled fans to do this on a new level—with NFTs.
NFTs, which refer to non-fungible tokens, are digital assets that are stored in blockchains. They can take the shape or form of many different things, such as digital artworks, virtual real estate, and now, digital sports valuables. Recently, several platforms that sell sporting NFTs have surfaced for all kinds of sports, such as baseball, Formula 1, football, and perhaps most popularly, basketball. This not only proves how far society has come from buying and selling physical sports memorabilia, it also provides a new platform that allows fans to connect to the sports they love in new and inventive ways.
NBA top shot
NFTs started way back in 2014 when they were primarily used for storing artwork to be preserved digitally. An NFT is a digital asset that represents real-world objects like art, music, in-game items, and videos. These assets grew in popularity when the pandemic shut down the sports world, and many sports fans started collecting, trading, and selling cards a huge amount. A great example of this is the rookie card of LeBron James, where his signature sold for 5.2 million USD, tying with the most expensive sports trading card with MLB legend Mickey Mantle.
In 2019, the National Basketball Association (NBA), in collaboration with some of its players and Dapper Labs, started its own NFT called the NBA Top Shot where it showcases jaw-dropping plays and unforgettable highlights of each active NBA player. It is being sold ranging from 9 USD to 230 USD per pack. The price per pack depends on the quality of each highlight, the stardom level of the player, and the exclusiveness of the card.
Fans can collect and trade through blockchain technology. According to a study from NonFungible and BNP Paribas-affiliated research firm L’Atelier, the value of NFT transactions has quadrupled to 250 million USD. A single clip of James and Zion Williamson is being sold for almost 200,000 USD each.
Risks and rewards
Although a relatively new creation, sports NFTs are the new craze in the industry and have steadily garnered traction among fans. Right now, there is no denying that the potential of sport NFTs seems limitless, especially with the world as borderless as it is with the power of the internet. There are many opportunities that could be found here, especially in looking into the numbers. NBA Top Shot, for instance, was able to earn 500 million USD in transactions within the first three months of this year. Even for the skeptic, it would be difficult to deny such numbers, showing that people are actually investing money in this young industry of sporting goods.
However, this opportunity also poses risks, as there are still unknown and volatile factors surrounding NFTs. Many people engage in NFTs right now as a method of earning money by trading these tokens with others, and because of this, prices have risen, but with this, there is the danger that they could fall in the future. Given that this industry is so young, the actual value of these NFTs could still be artificially inflated. However, this also means that over time, it is possible that these prices could go down.
Although it is difficult to determine where this industry could potentially end up in the long-run, the fact remains that NFTs, especially in the sports industry, have grown in value in such a short amount of time, and their current high values cannot be denied.
The future is bright
The pandemic has changed the landscape in terms of interacting with other fanatics across every sport. With heightened restrictions to prevent the spread of the coronavirus and the increasing developments in technology, sports fans have found ways to adapt and join the hype train. From trading sports cards to NFTs, fans adjusted and understood the new trend.
Despite that, NFTs still have their disadvantages. The first is the environment, because of the energy that is being used to power large computers in the verification processes by blockchain. The second is social, where people see NFTs as one brilliant way to make money.
The market is still growing, and it may still go through bumps along the way. But the future of sporting fan culture is bright, from collecting rookie cards back then to now collecting them digitally, with a wide variety of memorabilia from a picture of rookie players to exciting highlights of players.