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Bitcoin is infiltrating sports.

Jun 11, 2021

@UF

MAJR NEWS BRIEF

The intersection of Bitcoin and sports is happening. It will be hard to ignore this.

Sports are more than just a game. They represent a lot of things - team work, relentless effort, athleticism, big money, fame - most recently Bitcoin adoption. The industry has deeply embedded itself into America’s culture. Americans need sports…literally.

Though Covid-19 put a damper on the sports community barring people from packing the stands in arenas, it is fair to say fans are happy to be back.

Joe Pompliano @JoePompliano

This picture from the Islanders vs. Bruins game last night is amazing. Full arena. Loud fans. Sports are back.

Sports are powerful, especially in the United States. The games generate huge amounts of wealth, make fans travel for miles to see their teams play and sometimes move moods to riot in the streets pending the game’s outcome. Now, with the addition of cryptocurrency and blockchain, it’s like the entire industry is about to take performance enhancing drugs.

The technology offers the chance for franchises to monetize fan engagement, bring in sponsors and branding deals, level up sports betting and pay athletes in crypto.

We live in a digital world. Teams and players are looking to the future. The future of money.

NFL Athletes

The National Football League is by far the most popular and watched sport domestically. Even through a pandemic, the league captured an average viewership of 14.9 million just in the regular season of 2020. The NFL has some of the biggest names and contracts in the industry. For example, Patrick Mahomes, the quarterback for the Chiefs, inked a historic $500 million last June. While this is the most valuable contract in the NFL, the league minimum salary for being on a roster is $660,600 in 2021. That’s not bad, but there is something even better.

Two NFL players decided to set a new precedent and get paid in the best money around, bitcoin.

Russell Okung, the veteran offensive tackle for the Carolina Panthers, requested half of his $13 million salary in bitcoin for the 2020 season. Although the NFL declined, he went ahead and publicly converted his salary anyway using Strike’s Lightning application.

In December, bitcoin was $27k which clocked Okung in for $6.5 million. That’s roughly 240 BTC. Four months later, his $6.5 million had doubled as the cryptocurrency rocketed above $60k per BTC.

He was the first, but not the last athlete to pursue the digital gold.

Sean Culkin, a fifth year tight end for the Kansas City Chiefs, made headlines earlier this year saying he would convert his entire salary into bitcoin. His contract was just shy of $1 million.

Outside of these two individuals that pledged their salaries, huge names are now in on the action.

Tom Brady, arguably the best quarterback to play the game, put up laser eyes on his Twitter signaling support for the space. He recently spoke at Consensus 2021 confirming his conviction saying he is a “big believer” in cryptocurrencies and owns digital assets. Brady also took to Twitter informing everyone that he bought the dip this past month.

Trevor Lawrence, the 2021 first overall draft pick out of Clemson, signed a multi-year deal with crypto investment app, Blockfolio. A significant portion of the endorsement deal will be paid in cryptocurrency which includes bitcoin, ether, and sol. Outside of Blockfolio, Lawrence created a six-piece NFT collection through trading cards giant, Topps. This sold for $225,000.

Adoption goes beyond the NFL, and it’s only a matter of time before the majority of players start demanding bitcoin everywhere. The network effect is real. It will continue to grow reaching more highly compensated professional athletes. The topic of conversation amongst teammates and in the locker rooms all over the country is turning heavily to crypto. Though they may be top athletes by trade now, most seek to become savvy businessman or investors because their playing days do not last forever. These guys make a lot of money, and there is no better way to save and quickly accumulate wealth. Especially when you’re in your early 20’s.

Partnerships and Sponsorships

Partnerships between professional sports teams and cryptocurrency firms illustrate the expanding footprint of blockchain as a whole. More people are becoming educated and looking to take advantage of the technology. As a result, the dominoes keep falling. This list below provides some color and notable examples of organizations developing new strategies and getting involved in crypto.

The Sacramento Kings, an NBA team, became the first team ever to accept bitcoin in 2014. They also now allow their players or coaching staff to use this as a method of payment. This led to others getting involved like Mark Cuban and his Dallas Mavericks, who began to do the same practice in 2019 via Bitpay.
Litecoin was the official crypto partner sponsoring UFC 232 back in 2018. The event had a large impact on increased interest for the coin.
The Oakland A’s, a Major League Baseball team, started accepting bitcoin as payment for their stadium suites. On April 1, they completed their first transaction with crypto broker Voyager Digital for 1 BTC.

The New York Giants stamped the first NFL cryptocurrency partnership this year with the largest digital asset manager and investment firm, Grayscale Investments.

The NBA’s Miami Heat announced in March a 19-year naming rights deal for $135 million with the crypto exchange. It’s now the FTX Arena. They will be the official and exclusive cryptocurrency partner.
The San Jose Sharks announced this past week they will be the first NHL team to accept payment in crypto through Bitpay.

You get the idea. These two prominent worlds are on a collision course. This industry could help encourage the next wave of adoption that would send bitcoin to the moon.

Bitcoin and Sports

There are a number of reasons why bitcoin is positive for the community of sports, but the adoption piece is the most important.

Adoption is what makes Bitcoin grow and increase in value. Players will keep making headlines as more express interest in receiving bitcoin as payment or simply invest in the space personally. This news reaches millions of fans and other prominent players who then look into it further and invest for themselves. This is the network effect at work.

For the teams, it is very similar to institutional adoption and putting bitcoin on their balance sheet. We have seen huge investments from both public and private companies into bitcoin. They realize that simply holding cash diminishes their value and have appropriate concerns about inflation. Professional teams are a business and are potentially coming to the same conclusion. Offering ticket sales, suite deals, or other fan experiences with bitcoin as a payment method is a big step. In a simple sense, it comes down to wanting to preserve and protect your money. People in the front office for these organizations and those that strap up the cleats are starting to understand this. It is an opportunity to participate in a technology that is revolutionizing the financial system.

Wrap Up

This is the tip of the iceberg. I believe there is lots of untapped potential with the intersection of these two industries, and more teams will explore ways to implement the use of cryptocurrency across the board. Sports organizations and players are in a unique position of influence to progress the adoption of digital assets on a global scale. There could be huge upside for everyone involved as this progresses and crypto becomes more ingrained into the vast culture of sports.

I am not the biggest fan of baseball, but sports are a grand slam for Bitcoin.

MAJR Sports - Our video series about bitcoin adoption in the world of sports. Check out our recent video with formal NFL Quarterback Jordan Palmer - here.

Brevin White

@BrevinWhite

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