BUILDING A LONG TERM FUTURE FOR BLOCKCHAIN IN SPORT
Socios.com and Chiliz CEO Alexandre Dreyfus reflects on his experience at Web Summit and recent events in the crypto industry, saying there needs to be more balanced discussion when it comes to the relationship between sport and blockchain technology.
At Web Summit I had the opportunity to speak on two panels. The first focused on what happens when sports and crypto collide and the latter, on the main stage alongside our global ambassador and football legend Alessandro Del Piero, zoomed in on how blockchain will change the future of fandom.
The big lights of the main stage, the glare of the world’s tech media, ideas, thought-provoking conversation at every turn and one big thing in common, a unifying focus on the tech; Web Summit afforded me the opportunity to talk about the qualities blockchain possesses that can enhance the experience for fans and teams.
The experience strengthened my conviction that the narrative about sport and its relationship with blockchain so far has been unbalanced. Understandably, there’s been a lot of focus on the deals being done and the sums involved, but there’s been far less discussion around the positive impact this technology can have.
It’s easy to see how this has happened.
Throughout 2021 sports teams were striking up big money deals with leading exchanges and other blockchain companies at an unprecedented rate.
Elite level sport provided an obvious way for these businesses to gain exposure to huge audiences and the teams with significant new revenue.
The hype has subsided over the course of the last 12 months and the speed at which these deals are being done has slowed, but sport is still seen as the best way to achieve mass market exposure by the blockchain industry.
Recent high-profile events in the crypto industry will also mean the narrative continues to skew towards the deals over the tech.
And, we’ll see more evidence of this when football’s ultimate showpiece gets underway in a few weeks. We’ll almost certainly read more headlines about ‘sport embracing blockchain’.
But, providing advertising rights to an exchange or another blockchain based company is not the same as embracing the technology.
Advertising and exposure is one thing. Adoption and integration is another.
It’s time to bring balance to the narrative and to start talking more about the companies who are dedicated to harnessing this early stage technology to create positive changes that will enhance the experience for fans and teams in the long-term.
We need to consider the qualities blockchain technology possesses and how they can be applied to the sports industry. We need to define what constitutes ‘blockchain for good’ in sport.
Defining ‘Blockchain for good’ in the sports industry
When considering the qualities a blockchain based product should possess in order to bring positive change to the sports industry I believe there are three main criteria that need to be fulfilled.
It must provide utility
It must improve the fan experience
It must be scalable
On utility
During the height of the NFT parabola in 2021 a significant number of sports teams and athletes attached themselves to NFT projects which have since disappeared.
Why? Because the vast majority of these NFTs had no utility, no use case or value beyond the hype attached to them during NFT market mania. Because, it was never about using the tech to add value.
The ones that are still around are here because there is a vision behind them, a network of partners and because they offer a strong product with real utility.
Sorare is a great example of this. They have continued to build and strengthen their proposition, offering football, NBA and NFL fans the chance to collect NFTs, but also, and crucially, the chance to play and win, with fans building fantasy teams from their collections to earn rewards.
It’s not about making a quick buck. It’s about having a long-term vision and that’s why the NBA and MLB have both recently committed to multi-year partnerships with Sorare.
Sorare have carved out their niche and we have carved out ours. Fan Tokens are a blockchain based product that will stand the test of time and thrive because they offer real utility and they solve a real problem for fans and teams. How do you keep the 99% of fans who can’t watch games inside the stadium engaged?
If you don’t offer utility to your product, it lacks interest, and that’s what’s happening to many blockchain-based products right now.
We’re growing our user base every day. We’ve grown our team by over 70% this year and have nine offices across the world. We’re growing because providing utility to improve the experience for fans is at the core of what we do.
On improving the fan experience
The way brands engage with their consumers is changing. The consumer no longer wants to be told what to think. They don’t just want to use the product or service, they want to actively shape their experience.
They are not content with being passive customers. They want their feedback to be valued and lead to improvements. In the years to come it’s going to be two-way or the highway.
And, how do you create an environment where this new two-way reciprocal dynamic can flourish. Through digital communities, where your audience can belong and feel they have a share of influence in your brand (or team).
Forbes Agency Council recently listed the eight brands in 2022 that have built thriving communities. Brands that have burst onto the scene by adopting a community focused approach from the get-go and brands that have reinvented themselves by swapping segmentation and targeting for community building. Established brands like Duolingo, GoPro and Wendy’s. Relative newcomers like Gymshark and Riot Games. All thriving because they made it about the community.
The thing is, the current two way dynamic can only go so far.
It’s blockchain technology that can take this further, beyond thriving social media communities and into new token-gated environments where your share of voice and your share of influence is accredited and individually recognised. Where engagement with features and games linked to your brand leads to rewards and experiences.
That’s what we’ve created for the sports industry through Socios.com and Fan Tokens. A gamified, fan token-gated, engagement and rewards community for sports teams and their fans. Where fans can engage and compete, where they can truly feel part of it.
Alessandro Del Piero at Web Summit
“Travelling around the world with Juventus and Italy and playing in Australia and India gave me a different view on what a fan is.
“You play to compete and to win, but also to share the joy with the fans. Building a two-way connection with the fans is amazing. “
On scalability
There are some great NFT based projects that can work at scale. For instance, NFTs have the potential to serve as tickets for major sports and entertainment events, enabling seamless validation. GET Protocol has been at the forefront of this next generation ticketing solution and it’s a sector that’s primed for exponential growth.
It’s a great example of a scalable application of blockchain technology. But, the biggest sports teams, and brands for that matter, all have vast, digitally engaged, diverse global audiences with different ideas and unique needs.
When it comes to figuring out what works best for them, what makes them tick, NFTs can’t cut it as minting a few thousand becomes very expensive; scaling up to millions to achieve these aims isn’t feasible.
Fan Tokens can provide that scalability, because unlike NFTs they are fully fungible, allowing sports teams to build digital communities that can potentially encompass millions of fans from every corner of the planet.
It’s this ability to provide access and individual recognition to audiences at huge scale that sets Fan Tokens apart.
What’s next…
We’ve created what we like to call ‘Web 2.5’ communities on Socios.com through Fan Tokens, but we envisage a much bigger future for Socios.com and for Fan Tokens outside of our flagship app.
A recent report published by Research and Markets, the world’s largest store of market research, forecast that the global valuation of the Metaverse could grow to a staggering $1,237 billion by 2030.
We’re heading towards versatile, immersive real-time interactions with each other and the teams and brands we love in the communities that they will build. Communities built on blockchain technology. With the launch of Chiliz Chain 2.0, our new Layer-1 blockchain, we’ll enable sports and entertainment brands to start building for this new digital paradigm. And, we believe that Fan Tokens, with their inherent ability to provide access at scale can play a major role, enabling access to these new communities for sports fans.
Web Summit gathered some of the best minds in the space together, but there are lots of brilliant, innovative blockchain tech companies out there that will profoundly change and improve the way we experience sports and other sectors in the years to come. We need to start thinking more about the exciting changes that are on the horizon, we need to balance the narrative, we need to talk about the tech.
