Get off the sidelines and join professional athletes | Ingram Yuzek Gainen Carroll & Bertolotti, LLP

The NBA partnered with Dapper Labs to create Top Shot, a platform that allows fans to buy, own and trade video highlights from NBA and WNBA teams and players called “Moments.” These moments can earn a fan more collectibles when they participate in Top Shot challenges and other activities.

Similarly, the NFL has also partnered with Dapper-labs to create an analog platform called NFL All Day Fans can buy, own and trade video highlight NFTs of great NFL plays throughout the season and in NFL history. These videos are also called “moments” and, like Top Shot Moments, can earn a fan more collectibles when they participate in challenges and other activities. NFL All Day also offers weekly opportunities for fans to “gain yards and earn exclusive rewards” called the Playbook.

Sorare, a platform for fantasy football, NBA and MLB games, partnered with clubs such as Real Madrid and FC Bayern Munich. Like Top Shot and NFL All Day, fans can buy, own and trade NFT cards while managing their fantasy teams online. The cards gain or lose points based on the real-time performance of the players.

Individual athletes also engage with fans through NFTs. Most recently, on November 18, 2022, Cristiano Ronaldo dropped his NFT collection on Binance. This first collection features statues of Ronaldo in iconic moments from his life (as early as his childhood in Portugal) and different perks depending on the rarity level (Normal (N), Rare (R), Super Rare (SR) or Super Super Rare (SSR) ), including a personal message from Ronaldo and autographed merchandise.

These sports NFTs are becoming increasingly popular as they provide a new monetization avenue for athletes, clubs and sports brands. For example, as of March 2022, NBA Top Shot reached a market cap of over $1.1 billion, and as of August 2022, NFL All Day had a market cap of over $68 million.

However, as you may be aware, the NFT market is volatile and it is always wise to perform due diligence when investing in an NFT. As such, NFT platforms wrap themselves in terms and disclaimers. Binance’s announcement of Ronaldo’s NFT collection includes a “Risk Warning” that states: “The value of your NFT can go down or up. NFTs are exposed to high market risk. Please do your own research. NFTs are not regulated in most countries, but make sure you have access to the Binance NFT Marketplace based on your circumstances. For further details, see Binance NFT’s Terms and Conditions, our Terms of Use and Risk Warning.”

With the lure of athletes’ names attached to high-profile drops, it can be easy to buy into sports NFTs without caution, but celebrities and major NFT platforms are not immune to market volatility.

Pro baller Michael Carter-Williams was recently in the news for the NFT community he co-founded with Brooks Brown and Austin Grieshober called Players Only, which has since been acquired by Knights of Degen. Players Only promised its investors opportunities to interact with Carter-Williams and other professional athletes through the online community and IRL. Players Only also promised giveaways for signed memorabilia, real-life events such as training facilities, impromptu meetings and regular conversations with the players. Players Only raised roughly $1.5 million in NFT sales, but the community felt they didn’t receive anything they were promised. Of the seven professional athletes announced as founding members, six rarely participated in conversations on the Discord channel, there were only 3 in-person events, the Metaverse implementation never materialized, a baseball division led by McCullers never materialized, and signed memorabilia was either never sent (e.g., an investor won a giveaway for three Ethereum and an all-expenses-paid trip to Orlando, but only received Ethereum) or did not match the description (e.g., a winner tweeted that they won a signed jersey, but received an unsigned practice t-shirt saying “I have to admit, I didn’t do my research and bought a [NFT].”). It’s unclear if Players Only was a cover-up, but Carter-Williams tried to refund investors who requested one and also participated in one-on-one talks with investors to try to save his reputation and those involved in Players Only. . What probably happened was that the founders of Players Only bit off more than they could chew. Carter-Williams said, “Do I think people expected more? Yeah… But again, I don’t think people understand what it’s like to be in an NBA season and do all those things. I don’t think people understand how busy professional athletes are. »

Even experienced NFT company Dapper Labs experienced hiccups in the implementation of NFL All Day. In an Ask Me Anything (“AMA”) on Youtube in early November 2022, Dave and Noah of Dapper Labs engaged in a conversation with the NFL All Day community about their concerns about the platform. In that AMA, they discussed the recent layoffs at Dapper Labs, the lack of promised challenges, the recent lack of communication with the community, and the temporary halt of Playbook. A summary of Dave and Noah’s responses seems to be that NFL All Day is a live project that needs constant attention, and Dapper Labs is learning more about its own project and more effective ways to interact with the community as it progresses and as more feedback is received. of the community. Dave and Noah expressed that they try to walk the fine line between providing enough content that the community can engage with without providing too much content that collectors feel dilutes the value of the NFTs. Looks like Dapper Labs kept their promises (for now) as Playbook is back.

With these new and exciting ways to engage with our favorite players and teams, it falls, at least in part, on us to be flexible and communicate with the platforms. What is an athlete or a team without fans?