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Intro Notes, Plugs & Amendments 🔌🔧

ICYMI - Tweo weeks ago I had some personal news to share in that it was my last as a full-time employee at COPA90, as their head of Cryptomedia. I will continue to work with their amazing team in a consulting capacity as their head of Web3! You can read more about it here on LinkedIn.

Hello from Florida! 👋

NFT NYC was a blast and I’m now on my final day of travelling; in Florida after watching a Karate Combat event in Orlando that I was so kindly invited to by the team.

They’re building something special in combat sports and are definitely a sports league to keep your eye on.

I could have written about many things this week, but when the most famous and followed athlete on the planet partners with one of the leading crypto exchanges in the world, it’s hard to ignore that.

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🔌 If you would like me to come to an event and speak about Sports & Crypto / NFTs, please reach out on the ab

ove platforms.

This Week’s Deep Dive: Cristiano Ronaldo Signs Exclusive Deal with Binance

We all know who Cristiano Ronaldo is.

Well, I’m presuming you do, at least, if you’re reading a newsletter called Sporting Crypto. 

The TL/DR - Ronaldo and Binance struck a multi-year agreement NFT agreement, which will see the creation of a series of NFT collections for sale on the company's platform, with the first coming later this year.

But who are Binance and why is this a big deal?

Binance are the biggest crypto exchange in the world.

By a considerable distance. If you look at the spot trading on their exchange for crypto, it gazumps the juggernaut that is FTX by almost 7 times over.

They launched in July 2017 before the back-end-of-2017 massive crypto rally, and have continuously posted up crazy numbers since.

Binance are pretty much everywhere. 

They made headlines a few months ago for trying to encroach on Socios’ chokehold of the ‘Fan token’ market by signing a deal with Argentian FA…which sparked legal action from Socios.

But this is by far their biggest venture when it comes to Sports.

During this crypto boom, athletes worldwide have been approached by partners worldwide begging them to work together on NFTs.

I know this because I’ve spoken to many of them, their agents and intermediaries.

If you’re top 100 soccer player in the world, your agent is probably fielding between 3-10 crypto partner offers a week.

So actually getting them across the line in the first place, is tough.

To get it done with CR7, is pretty astounding and I’d shudder to think of the numbers involved.

Especially - when you consider that Peter Lim, a Singaporean businessman, and his company MINT Media actually own Ronaldo’s image rights.

That’s right, in 2015, Cristiano and his team sold his image rights in what was seen as a strategic move to grow the brand in Asia, especially.

And as an aside - Peter Lim’s son, recently created a Sports DAO with Manchester United legends Ryan Giggs and Gary Neville called CO92 aimed at ‘democratising club ownership’.

So you can see how close Ronaldo, Lim and the Manchester United brand have stayed even after originally leaving the club over a decade ago.

What’s the play here by CR7?

A few weeks ago I wrote a piece talking about product market fit for athlete NFTs.

Realistically, there isn’t one, especially if commercials are the first priority.

With that being said, this isn’t just an athlete. It’s a historic one. 

Across the pond, Steph Curry, a Legendary basketballer in his own right showed the world that athlete based NFTs can be done well.

…If you’ve got the brand pull that someone like Steph Curry does.

Cristiano Ronaldo is one of the two best players to ever play the biggest sport in the world. If he’s not number 2, he’s number 1, depending on who you favour out of him and Lionel Messi.

And speaking of, Lionel Messi’s ‘The Golden One’ NFT was sold for $3.4m on auction and then resold for $9m on secondary markets.

Considering he and Ronaldo have had a ‘Whatever you can do I can do better relationship’ for the last 15 or so years, it’s no surprise Lim, Cristiano and co are coming after this market, hard.

What they do is anyone’s guess. 

And whilst I truly do think most athletes shouldn’t do NFTs themselves, it’s a different story for someone who is one of history’s best and has literal superfans.

Like, people who follow his every move and obsess over every Instagram post.

My bet is it is those super fans that Ronaldo will try and leverage rather than doing something far reaching.

But the sweet spot if this is something I was working on, would be to try and hit both of those angles. How can you monetise some of the most heavy-hitting image rights in sports whilst also giving your 100m+ audience a shot at owning something digitally to show their support, for little to no cost?

The Lionel Messi NFT is a perfect example. Rich people pay money to own rare things that represent famous sports stars. Whether they’re digital or physical, like a Michael Jordan rookie card.

Superfans will also pay good money to own something that the CR7 brand has shipped.

But on the far-reaching side od things my favourite example is 100 Thieves (100T). The E-Sports Org celebrated their world championship by giving away almost 1 million free NFTs on polygon. Of which, many were claimed by people who had no clue what NFTs are.

So far, we’ve gathered that: 

• Broadly speaking athletes shouldn’t do NFTs, because they’re done badly

• If you’re a superstar athlete with a massive brand, your brand sells digitally as well as physically to a vast array of people

• Doing these deals is very complex

• Athletes will only do these digitally based deals with huge brands (Curry with Underarmour and various NFT communities, Messi with a former Marvel artist and now Ronaldo with Binance.

But…what’s in it for Binance?

Why are this huge crypto exchange doing an NFT partnership with Ronaldo?

Because the NFT market is massive and will be even bigger in the future.

Leading marketplace OpenSea have done over $30 billion in volume all time, and continue to be the market leader.

And whilst Binance became the biggest crypto exchange fairly easily by having looser KYC controls, fewer fees and generous sign up & affiliate schemes - doing something similar in the NFT space is not gonna cut it.

Why?

Simply put - the tokens are non-fungible compared to cryptocurrencies that *are* fungible.

That means that starting a crypto exchange is fairly easy if your balance sheet is filled with the tokens you’re selling. Then you need to drive demand for your exchange.

With an NFT platform, you actually need to convince consumers to list their NFTs.

You don’t control the supply side as an NFT platform, and that makes it REALLY difficult to gain traction.

LooksRare, Opensea’s closest competitor literally pays people to list their NFTs on their platform. It sounds weird, but it makes sense considering users control the supply side.

So whilst usually, as a marketplace, you’re trying to increase demand, NFT marketplaces require you to maintain the supply of listings as well.

I liken this to someone trying to compete with say…Twitch.

To get the audience, you need to convince creators to stream on your platform.

So at first, you’re incentivising a good supply of content creators. And those creators also generate demand, because their audiences have an affinity to the creator, not the platform (for the most part).

Remember when Ninja, the biggest streamer out there, signed a $40m deal with Microsoft’s Twitch competitor, Mixer?

That’s what Binance are essentially doing with Cristiano.

They’re paying for exclusivity to sell his branded NFTs, to help drive demand, but also drive supply of NFTs on the platform.

Pretty much most NFT platforms are struggling here. They just can’t get enough traction on the supply or demand side.

And whilst Binance don’t yet have the slickest NFT marketplace, they have a lot of cash and an existing user base of over 30 million people to tap into on the crypto exchange side.

Many people are betting on greenfield NFT market competitors, everyone having their own NFT marketplace (like a website) or something else that drives trades.

But the reality of this is that NFT marketplaces are a complicated business.

And doing deals like this with the likes of Ronaldo might just mean that the best way to compete with OpenSea is by having exclusive deals with brands or people that drive huge demand, and also ensure the supply side of the market is filled appropriately.

More sports crypto stories & things to put your radar

• The VBA (Virtual Basketball Association) have launched their first-ever season. Good luck to the team over there!

• eBay are making a big play into the NFT space…that’s important considering their big hold on the physical collectible space.

• Puma are continuing their move into the space, this time partnering with NFT project 10KTF

• WAGMI United and Crawley Town are starting to make waves…waves that I definitely didn’t see coming when I first wrote about their new ownership. Fair play, lads.

• More from Crawley Town - their third kit will only be available to those who buy an NFT. I think this is interesting, but perhaps a bit too forward considering the audience is not ready in the slightest.

• Hackney marathon runners were given NFTs as rewards for their participation! Digital medals, we could call them.

• CLUB have launched their Beta mode! 

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

• Solana, a layer 1 protocol similar to Ethereum, is releasing a phone…So many ways this could do well and also do horribly.

• People don’t realise centralisation is an issue until it is. 

• There is huge western arrogance when it comes to Crypto

• According to leaks, GTA 6 will have a cryptocurrency. I’m sceptical they actually do that, and if they do, they’ll probably do it badly.

• Web3 still needs to find *that* moment. 

Thanks!

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 business or entity.