The Benefits of Blockchain Technology in Professional Sports
The sports industry has been rife with fraud scandals over the past years. But this is not surprising as there is a lot of money exchanging hands in professional sports. Say, through player transfers, sponsorships, selling of branded merchandise, and so on.
To clean up its image and management process, professional sports bodies have joined the league of industries using Blockchain technology.
Blockchain technology promotes transparency in player management, health or doping management, revenue earnings, and all other operations of professional sports.
Below are the benefits of Blockchain technology in the professional sports industry.
It increases sales of sports merchandise
No business is self-sufficient. All businesses thrive on the support of their clients. And professional sports is no different; it relies on fans for revenue.
Professional sports bodies have introduced virtual tokens that fans use to buy club merchandise, tickets, beverages, and snacks during matches. Sports bodies/leagues like the NFL, the NBA, and the MLB have also invested in crypto collectibles that they sell to sports fans. Crypto collectibles are digital versions of the well-known physical baseball cards and bobbleheads sitting on playroom shelves.
They also get money from ads revenue and TV rights.
It increases fan engagement
The profitability of the professional sports industry depends on the increase in fan engagement. Many sports communities are using Blockchain technology to enhance fan interaction. They are doing this through the creation of the “fan identity.”
These bodies give exceptional or super fans a non-fungible token (NFT) that verifies their fan status and gives these fans direct interaction with players without the help of third parties.
How does one become a superfan? These teams use the public data provided by the fans on a public Blockchain and apps dedicated to sports communites. They use this information to offer personalized experiences that continue driving fan engagement.
Professional players receive salaries in Bitcoin
Since Bitcoin and other cryptocurrencies are becoming more accepted as forms of payment globally, it is no wonder that some athletes have decided to receive part of their salaries in Bitcoin, an application of Blockchain technology.
Examples of such players include NFL star Russell Okung who received half of his USD 13 million salary in Bitcoin in 2020.
It reduces token fraud.
There has been a lot of token fraud in game tickets. And although different measures have been put into combating this, token fraud has still prevailed.
The application of Blockchain technology in professional sports has led to non-fungible tokens (NFTs) or digital tickets. NFTs are unique in that they are only verifiable with Blockchain technology. And since it is hard to cheat the Blockchain system, it is hard to duplicate or reproduce NFTs.
It improves the management of player data or analytics
Incorporating Blockchain technology into professional sports has improved the secure storage of all types of player-related data. Different sports bodies use centralized and decentralized ledgers on the Blockchain to store and view player analytics. Players can also use decentralized ledgers to share all the relevant information or analytics required and keep private their personal data.
Likewise, potential sponsors and employers can use a private key to access specific information about a particular player. This information (player analytics) includes the player’s performance records, history of club transfers, management and payment fees, health status, or data.
It increases the effectiveness of the anti-doping policy
Professional sports have been rife with doping scandals, where players cheat the system by changing their drug tests. But this is becoming a problem of the past.
If there is one thing that Blockchain technology is unbeatable at, it’s its high level of transparency. It is near impossible to cheat the system. And this could be why professional sports have adopted its use case in their anti-doping policy.
How does Blockchain help in doping management and regulation? Once the medical reports or data is on the Blockchain, no one can change it. This means the players or their agents cannot tamper with the results. So if a player came out positive from a drug test, his fate is sealed.
It protects the players’ rights
Every professional player undergoes a transfer. And transfers come with the creation of new contracts. Every time a new contract is drawn, players’ rights have to be listed and agreed upon before signing a new contract.
The use of smart contracts has secured or protected the validity of a player’s agreements with their clubs. Before Blockchain technology, player contracts were drawn using word-processing programs that could easily be altered or manipulated. But now, using Blockchain technology, players’ rights are cryptographically protected.
Such rights include the player’s name, his brand value, pay/salary, the duration of the contract, and the royalty rights from using the player’s image. The NFTs have now made it possible for players to receive royalty payments from branded memorabilia or merchandise sales automatically.
Conclusion
There has been an increase in fan engagement, sports revenue, and transparency in management and financial transactions in the sports industry.
So the use of Blockchain technology in professional sports is here to stay.
