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Intro Notes, Plugs & Amendments 🔌🔧

This edition of Sporting Crypto is brought to you by Momento Market - football’s auction house. More to be revealed soon but for now, join the waitlist.

Something a bit different in today’s newsletter. Not that there’s anything wrong with news or market commentary, but I pride myself in trying to offer something different.

Many news outlets will commentate. Some will offer insights.

I want Sporting Crypto to cover those bases and offer an added level of depth. This is, after all, a newsletter talking about the bleeding edge. Therefore, I should be exploring very much that — the bleeding edge.

The innovators and those who experiment are often less covered because there are not as many clicks in doing so.

And asking the question ‘what if?’ often leads to quite speculative ideas and writing.

But I think that’s good, especially in a space that could do pretty much anything over the next 5-15 years.

A couple of PSAs before we get into things:

1.  Next week’s newsletter will publish on Tuesday 30th August due to a national holiday here in the UK!

2. This week, we’ll be doing a special ‘featured’ bonus edition of Sporting Crypto — interviewing the founder & CEO of Momento Market, who have been sponsoring the newsletter over the past couple of weeks. I’m really interested to see the reaction to it. I personally think it’s pretty good, and while it isn’t crypto native, the company excites me. 

🔌 If you’d like to work together in a consultancy or workshop capacity, please respond to this email! 

🔌 We have sponsor slots available from September 12th onwards for Sporting Crypto. If you’d like to partner, reach out on Twitter or LinkedIn, or email me back at this address!

🔌 If you would like me to come to an event and speak about Sports & Crypto / NFTs, please reach out on the above platforms or reply to this email.

This Week’s Deep Dive: What if The Worm NFT was a Sports Project?

The last couple of newsletters have focused on news stories and Sporting Crypto will always explore them in a deep and insightful way.

This week, however, I want to think slightly laterally.

‘What if?’ has become something I’ve heard a lot in crypto more broadly But I think it’s very important this question is asked especially when it comes to Sports x Web3.

There are so few good examples of Web3 x Sports — that sometimes, this is what it takes to try and explain to stakeholders and the uninitiated what is going on here.

There are a lot of abstractions. 

Stuff like “The Metaverse is the blend between the physical and digital” Now, I’m not here to berate or tell anyone that these abstractions are wrong or shouldn’t be said. These abstractions are useful, to an extent. They’re good at painting a very broad picture of what this ‘thing’ is or could be.

But examples of how and why are more useful. Even digging into the intricacies of that broad picture, is more than useful than simply quoting an abstraction.

So let’s try and use an example of a project called ‘The Worm NFT’ to explain why, how and where Web3 in Sports.

And yes, this is weird and funky - so bear with me.

So what the hell is the worm NFT?

The Worm NFT is an NFT that is a ‘Mint to Share’ project. 

It’s experimental and fun. But what interests me is what it could mean for NFTs in the future. And especially how brands could be inspired by it.

Let’s start with what this thing is. The Worm NFT is kind of what it says on the tin; an NFT of a vibrant pink worm.

It was created with one purpose: to travel across the Ethereum Blockchain.

Users who receive the worm are asked to share the worm with another wallet. It’s the sole ‘use case’ of the NFT.

When you share it with another wallet, you are gifted a hologram of the worm NFT.

The hologram is numbered.

If I was the 7th holder of the worm, I’d have the hologram version of the worm numbered 7. 

Why would I want The Worm, I hear you ask?Well — firstly, it’s just fun.Secondly — the surprise and delight aspect of The Worm as it reaches certain milestones.

For example, when The Worm reached 100 ‘disciples’ — Brian Brinkman, a famous NFT artist, collaborated with their team to give all those 100 Worm hologram holders a commemorative NFT.

There have actually been 10 secondary sales of The Worm x Bryan Brinkman.

What does this have to do with Sports and Web3?

Well, directly — absolutely nothing.

But when looking at the intersection of these two spaces, the two major successes have been Top Shot and Sorare. There are more niche ones, of course.

But if we’re talking mass market and 100s of thousands of users, you’re looking at those two.

They’re license based. Which makes sense — licensing is always going to play a part in anything related to Sport. There will be, like physical collectibles, a select number of juggernauts who compete for these licenses.

But we’ve gotten to a point now that, 3 years after Top Shot really made a name for itself, the innovation in Sports x Web3 is quite lacking. The behemoths mentioned are doing well, but beyond that, there’s not as much happening as you’d hope.

This isn’t surprising if you consider how slow these huge sporting institutions are at moving.

So far there’s been a purely commercial lens in terms of how Web3 is viewed. But I think that’s waning slightly.

The multi million dollar sponsorship deals will still happen, but above all, the cash grab NFT projects and partnerships with dubious crypto entities are likely to be few and far between after many were burnt.

Beyond that, the opportunity I see here for sports is the same one we saw with Social Media.

Social created a new paradigm for fan engagement.

And Auxiliary content and social channels really changed broadcasting.

Fan channels, Twitter accounts, blogs, youtube channels and podcasts all exploded due to this new distribution mechanism.

Now, blockchains aren’t totally analogous — but there are enough similarities to write a newsletter about.

Let’s start with this:The transparent nature of blockchains means you can create on-chain communities, that the entire world can program and create products that they can interact with

What does that mean in normal terms?

Currently - I use my Google account to sign in to apps or sites that I don’t want to make new accounts on.

That’s me trading my data for practical surfing of the web and pragmatism.

A fair enough trade even though the big tech behemoth likely knows more about me than my parents.

With a blockchain, coupled with NFTs as the ownership piece of this equation, you can create situations where the APIs and connectivity between siloed worlds don’t need to exist in the same way.

And these siloed worlds will definitely still exist. The ideals preached by Crypto fanatics are almost definitely wrong.

But the optionality to have sovereignty over digital assets, and plugging in and out of siloed environments on the internet is a great alternative to having Google, Facebook or Apple the basis of your digital footprint. You should be your digital footprint.

This doesn’t mean Apple, Amazon, Google and such won’t exist. It’ll mean that people using the internet have options, and those options might create pressure on their siloed counterparts to create better solutions.

Why is that important context?

Because, whilst blockchains aren’t the be-all and end-all, but they’re definitely going to make an impact. So it’s worthwhile understanding why they make sense and why so many of the smartest entrepreneurs in the world are building here.

But back to the social media analogy.Currently, we’re in a situation where: 

1. Blockchains are inherently financialised in their nature due to their origins; Bitcoin

2. NFTs are the first time Crypto has crossed the chasm of culture, since its inception in 2009

3. Because of (1) some of the best usecases have simply been rampant speculation

4. Because of (1) and (4) — sports clubs, especially football teams, have seen this as an opportunity to make lots of money

5. The money is still there from a sponsorship perspective, but not a cash grabby NFT, token perspective 

Where we’re going likely feels like this:

1. The quick, cash grab money runs out for sports brands

2. They’re forced to reimagine why this is important to the future of their businesses

3. Contracts run out with vendors they thought would solve all their web3 problems

4. They sign new ones or hire in-house help to make them make sense of this

5. It’ll cost them money — but the ones that do it right will be well placed (a la Manchester City with digital in 2008)

To bring this all together in a roundabout way, we have:

1. Mostly cash grab stuff happening in sports x Web3

2. The analogy to Social Media - a new paradigm for community building and distribution and

3. Stuff like The Worm NFT - on chain, incentivised virality that brings a community together.

Let’s run through an example to help us make sense of all of the random things I’ve collated above.

Let’s say my treasured Arsenal, made a cup final this season.

And to my delight, they win it.

The default for what is now an entertainment brand in Arsenal is to create a lot of content.

Maybe even some memorabilia.

Even an event in the form of a parade with a trophy.

What if there was a mint to share NFT, like The Worm, that was created and sent to all the wallets of the fans that were there in the stadium that day?

Commemorative in its nature, and like The Worm, rewards you for sharing it.

Suppose this gets to 1 million fans worldwide.

A lofty number considering there are only ~35m people with Metamask wallets out there. But let’s use the number for the sake of this example.

The great thing now is, with these NFTs being on a blockchain, let’s say Ethereum for argument’s sake - they are created on an open source standard piece of infrastructure that anyone can build on.

Anyone can build something on Ethereum, to then allow those Arsenal NFT holders to leverage the fact that they have, or had, said FA Cup Final NFT in their wallet.

Let’s say McDonalds decide that by signing into their site or app with your wallet, that holds said NFT in, you get a free cheeseburger the week subsequent to the FA Cup Final.

Let’s say an image printing company allows for free prints for a week, from Arsenal fans, who had the NFT. Allowing them to print their FA Cup final memories, in this example.

Arsenal could then collaborate with an artist to create a digital piece of memorabilia and send it to the million wallets who have had the NFT passed to them.

In 5 years time, Arsenal could offer discounts on merchandise (digital or physical) due to the fact a wallet had that NFT in it.

As you can see, the examples I’ve given are not fully formed and are off the top of my head. But you can see here why there’s a massive new playground for marketers to play in.

The same way that Social Media became one during its inception.

Once the commercial lens is dropped, and it will eventually, we’ll see some very interesting things happening in Sports x Web3.

And I think ownership and fan engagement will be at the heart of them.

Not speculation.

More sports crypto stories & things to put your radar

• Gryfn, a JVC between Animoca brands and Hex Trust will be the title sponsor of the San Marino Gran Prix 2022 & 2023

• Sorare have partnered up with Football transfer king Fabrizio Romano!

• Socios have secured regulatory approval as a service provider of virtual currencies and digital wallets from Italy. 

• The Houston Texans are accepting crypto for single game suites. 

• Bybit have written a mini report about how crypto is changing the Sports Industry. 

• An article from TechCrunch on how successful Crypto partnerships have been in sports.

Great reads, great tweeting and more general ‘stuff’ that could impact you

• OpenSea volumes in June; a 5 year timeline. 

• FOX have said they're prepared to invest up to $100m in NFT and Blockchain initiatives. 

• Good tweet by Loopify. Many people conflate ownership with rights.

Thanks for reading the latest edition of the Sporting Crypto newsletter. I’m really happy to see so many people enjoying it and sharing it with their networks. If you enjoyed this, please tell your friends who might be interested - and share it on social :)

This newsletter is for informational purposes only and is not financial or business advice.These are my thoughts & opinions and do not represent the opinions of any other person, business or entity.