The FIFA World Cup is here, and with it comes the latest in football technology. Qatar has been chosen to host the event, and they are pulling out all the stops to ensure it is a success. One of the crucial technologies used to promote the World Cup is blockchain.
Blockchain is a distributed database that allows for secure, transparent transactions. It is perfect for handling the large amount of data associated with sports tournaments. In addition, it can be used to create smart contracts that automate payments and other processes.
Qatar has NOT decided to use blockchain throughout the World Cup. The main reason was that the moment that Qatar won the election for the championship, blockchain technology was in the early stage of development. Also, it’s good to know that crypto is illegal in Qatar – for now.
Blockchain and Qatar
But I am sure the next world championship (Atlanta, United States) will use blockchain with greater intensity than today’s NFT or token involvement. It will include tracking player performance, managing ticket sales, and broadcasting online matches. The future World Cup will ensure everything runs smoothly and securely using blockchain.
The Qatar 2022™ World Cup is one of the most high-tech and innovative tournaments in history. This is excellent news for football fans worldwide, as it means they will have a new way to purchase tickets, merchandise, and food and drinks within the stadium by paying with their chosen crypto.
Also, in May 2022, it was announced that US blockchain company Algorand is taking up the sponsor role. And as FIFA states, they are forming technical cooperation with Algorand. They will help FIFA define its cryptocurrency strategy, including football-related NFTs and developing a blockchain-based wallet.
Blockchain in sports has incredibly huge potential. And even though crypto is illegal in Qatar, Algorand will make big steps with FIFA in defining new standards in football technology.
Crypto and Championships
As an Official Sponsor of the FIFA World Cup Qatar 2022™, Crypto.com will be the event’s exclusive cryptocurrency trading platform sponsor, for the project was introduced QATAR 2022 TOKEN (FWC). This means fans worldwide can use FWC to purchase match tickets, merchandise, and more.
But that’s not all – FWC will also be used to reward fans for their loyalty and support. For example, fans who attend matches or participate in online polls could earn FWC tokens as rewards. This would incentivize people to get involved in the World Cup and help create a global community of football supporters.
It was only a matter of time until the worlds of blockchain and sports collided. And when they did, it was an exciting new frontier for fans and investors.
Fan tokens were created and distributed amongst fans through a Fan Token Offering (FTO) (similar to the concept of an ICO). Unlike an Initial Public Offering (IPO), fan tokens do not represent ownership in the equity of shares in any sporting club – but the venture was still highly profitable.
For example, FC Barcelona ($BAR) generated US$1.3 million less than two hours after selling on the Chiliz Exchange. $BAR fan tokens were sold in 106 different countries.
The success of these fan tokens had many people wondering if other professional sports teams would follow suit. The answer turned out to be a resounding yes, as more and more teams began launching their FTOs. In fact, by the end of 2020, over 60% of all major league sports franchises had issued their fan tokens.
This new era of sports fandom brought a new way to collect and trade memorabilia. Fans could now own a piece of their favorite team – not just figuratively, but literally. And as the value of these fan tokens continued to rise, so did the excitement around them.
Smart contracts and athletes
When digital contracts became popular, athletes were some of the first to take advantage of them. They could now control their likeness and be paid automatically when it was used in an ad or game. This allowed them to make money even when they weren’t playing.
One particular athlete, Magic Johnson, decided to take things a step further. He issued a limited number of digital collectibles of his best plays. Fans could buy these tokens and share in his success. They could also invest in his funding journey and reap returns when he hits the big time.
With Crypto.com as an Official Sponsor, we can be sure that blockchain technology and cryptocurrencies will play a significant role in the running of the event.
Blockchain in sports – Use cases
As blockchain technology has started to find its ground in the sports industry, new revenue streams have opened up. From fan tokens and digital collectibles to fan loyalty and engagement platforms. This allows for a younger, digital-first fanbase to grow. In time, this leads to increased revenue which is something that sports clubs and companies in the sports industry don’t want to miss out.
Here are some of the most popular use cases of blockchain in sports.
Use case #1: Fan tokens
The reason behind the exploding popularity of fan tokens is their ability to create more revenue streams and increase engagement between fans and sports clubs. Usually, clubs and sports companies enable users to buy tokens with fiat currencies.
This will still be a crypto transaction, but in the background, those fiat currencies need to be converted into cryptocurrencies and then exchanged for merchandise, collectibles, or real-life experience like meeting a certain player.
Top-level football clubs like FC Barcelona and Manchester City have already succeeded with fan tokens. FC Barcelona sold their first round of fan tokens in less than 2 hours – and it was worth $1.3 million.
Digital ecosystems are becoming increasingly important to sports clubs. Using blockchain in sports, they can reach an unimaginable number of fans and grow their international fanbases.
Use case #2: Digital collectibles
Digital collectibles are usually unique or created in limited quantities. Every digital collectible is, in fact, an NFT. Their uniqueness can not be disputed, as every NFT can be verified by immutable blockchain technology.
Implementing blockchain in sports has endless potential. For example, fans will be able to buy unique limited-edition player cards and earn incentives for collecting entire collections. Such digital collectibles are already gaining popularity in the US, especially in the Major Baseball League. They have enabled fans to purchase digital collectibles, regardless of their location, at varying prices. This attracted numerous new fans, especially younger ones who are prone to using digital technology.
Use case #3: Loyalty and engagement platforms
By using loyalty and engagement platforms, sports clubs can harness the power of blockchain to create a sense of community and belonging among their fandom. They can reward their fans for interacting with their websites, creating content related to their club, sharing official posts, and much more.
These rewards are often in the form of fan tokens which fans can, in turn, use to buy merchandise, digital collectibles, and more.
Even though this is a great way to increase the ROI for their sponsors, the main benefit is increased engagement and an increased number of loyal club fans. Building an exclusive fan community is no small task, but doing it on a blockchain is something we couldn’t have imagined several years ago. Now, this is a standard.
Use case #4: Blockchain ticketing systems
Blockchain in sports has been used even in ticketing systems, which is no surprise. Using blockchain to transfer ticket ownership, store tickets, and purchase them has proven to be much safer than traditional methods. There is now no need for any intermediary or a centralized system.
And another benefit of blockchain ticketing systems is that – no one can falsely claim they purchased a ticket. With blockchain, the possibility of counterfeit tickets is zero. And if a sports event is delayed or postponed, rescheduling and reusing the tickets will be much simpler for both organizers and fans.
Lumen Spei will help you create new revenue streams with blockchain
Our team is experienced in building complex systems, especially creating innovative blockchain solutions. We can help your team create the exact solution your users need.
If you want to help your sports club generate more revenue and create a strong connection with your fans, we’ll happily do our best to see you succeed.
Blockchain in the sports industry is only in its infancy stage, and we have a long way to go until we see mass adoption. But taking into account the successful examples of clubs like FC Barcelona, we can say that blockchain is more than welcome in the sports industry.
If you have needs or ideas for your blockchain/crypto/NFT project, please don’t hesitate to contact us!
