As such, it offers crypto companies exposure to a large number of potential users and investors.
Aligning with sports helps blockchain-based companies reach a mainstream audience and potentially encourage mass adoption of their products. Well-established crypto companies go beyond merely offering BTC for sale or purchase, shifting their focus on developing relationships with tech-focused sports entities in a desire to tap into their vast-spread communities.
In this article, we’ll delve deeper into the crypto sponsorships in basketball and analyze the strategic implications for both the cryptocurrency industry and the basketball ecosystem.
NBA Sponsorship Deals
NBA sponsorship revenue has significantly increased from $1,39 billion in the 19/20 season to a staggering $1,66 billion in 22/23. Until recently, big-name companies like Nike, Microsoft, and Rakuten were the league’s main source of income. However, it all changed in 2022, when the association reached a $4,3 billion deal with a fantasy sports and NFT trading platform – Sorare.
In addition to the massive cash injection, the NBA tapped into the metaverse world and agreed to create NFTs of individual players, where participants could earn rewards based on how their players perform on the court.
Major Team Deals
Franchises also couldn’t stay immune to the irresistible charm of crypto sponsorships, with some being more lucky than others.
In 2021, the Miami Heat signed a $135 million 22-year sponsorship deal with FTX. Unfortunately, after FTX collapsed, the federal bankruptcy court terminated the naming rights between the said company and Miami-Dade County, leaving the franchise without its main source of revenue.
On the other side of the spectrum, some teams were fortunate to hit massive deals. Collaboration between Crypto.com and AEG is a good example of such a practice. The iconic Staples Center, home of the NBA’s Los Angeles Lakers and Clippers, changed its name to Crypto.com Arena in a $700 million deal.
Coinbase became the exclusive cryptocurrency platform partner for the NBA, WNBA, and NBA affiliate leagues. The estimated value of the four-year deal is around $192 million.
Philadelphia 76ers, an NBA franchise currently rebuilding, struck a deal with Crypto.com. Besides getting a New Jersey patch sponsor, the team from Fargo Center received a substantial monetary injection, worth $10 million per year. The franchise also released its collection of NFTs, available for all non-fungible token and crypto lovers.
Players Entering the Crypto Realm
The crypto fewer didn’t only hit the NBA organization and its franchises. Players also decided to jump on the bandwagon and seize the opportunity to strike massive deals with crypto companies.
NBA superstar and one of the best players in the game’s history, his majesty King James, embraced Web3 after partnering with Crypto.com. The LeBron James Family Foundation (LJF) signed a multi-year deal with a famous crypto platform, marking a significant milestone in the convergence of sports and blockchain.
Former Brooklyn Nets and now Phoenix Suns superstar Kevin Durant reached an agreement with Coinbase in 2021. The crypto exchange company agreed to run crypto ads and sponsored content on Kevin’s sports website, Boardroom, in exchange for the superstar becoming the face of the brand.
In a noteworthy trend within the NBA, a growing cohort of players express their belief in cryptocurrencies, particularly Bitcoin, without seeking endorsement deals or partnerships. Matthew Dellavedova, a former NBA player, now a member of Melbourne United, stands out as a prime example of this movement.
Dellavedova’s notable decision to invest heavily in Bitcoin is rooted in skepticism toward traditional banking systems. Rather than capitalizing on endorsement opportunities, he is driven by a fundamental belief in the decentralized nature of cryptocurrencies and their potential to provide a more secure and transparent financial alternative.
Is there a Future for Crypto in the NBA?
Given the circumstances surrounding crypto and the unbalanced terrain marked by frequent price fluctuations and inherent volatility, the logical question arises of whether such a sponsorship model is sustainable, particularly in the aftermath of events such as the crash of FTX.
While the regulatory status of crypto varies across different countries and regions, positive sentiment dominates as an increasing number of jurisdictions recognize the potential benefits of embracing blockchain technology and cryptocurrencies.
Should blockchain and cryptocurrencies continue their trajectory of evolution, the basketball landscape stands poised for transformative change.
In the future, we can expect crypto companies to continue legitimizing their brands in the eyes of mainstream media and audiences, focusing on younger and more tech-savvy demographics.
Also, as the collaboration between the basketball association and crypto companies expands, we can expect more joined initiatives, co-branded products (like NFTs) and other unique fan experiences that benefit both parties.
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Author: Team Dunkest
December 28, 2023 | 7:15 am
