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Tucked into the far corner of my closet is a pair of musty-smelling hockey gloves that belonged to one of my favorite Philadelphia Flyers: left-winger Scott Hartnell. When I was a teen, I begged my father to buy them, believing there was something special about owning the torn, oversized and otherwise useless gloves that Hartnell once wore.
So like a lot of sports fans, I’m familiar with the concept of buying rare items of sentimental and questionable financial value. It’s no surprise, then, that sports fans who’ve long collected trading cards and autographed baseballs are apparently more likely to embrace NFTs, the digital assets that prove ownership and authenticity through blockchain technology.
According to a new survey from Playa Vista-based National Research Group (NRG), sports fans are both better informed about NFTs and are more likely to have a positive opinion of them. For example, 81% of “avid sports fans” in the U.S. were open to learning more about NFTs. Compare that to just 31% of American consumers identified as “non-fans.”
That’s good news for startups like Santa Monica-based Autograph, the NFT sports agency co-founded by NFL legend Tom Brady. Autograph, a platform that lets athletes sell NFTs directly to fans, is among a crop of tech companies in L.A. and elsewhere that have raised millions from investors to bring non-fungible tokens to the sports world.
There’s a “relationship between NFTs and digital collectibles, and traditional sports memorabilia and collectibles,” Jay Kaufman, NRG’s executive vice president of sports, told me. “A lot of sports fans are not necessarily in the NFT space…for the pure profit, but there's an emotional tie to it.”
Fan infatuation with collectibles isn’t the only thing driving this trend. Some of the earliest high-profile NFT projects—such as NBA Top Shot—were sports-related. That has given sports fans more time to learn and understand the technology, Kaufman said. One could also draw a connection between NFTs and the rise of sports betting, which may soon come to California. Many fans have shown that they’re willing to take on some financial risk by placing wagers on games and player performance.
That’s not to say sports fans aren’t skeptical of the technology and aware of its problems. The crypto market’s financial freefall and headline-grabbing scams have made fans understandably leery. Just 15% of sports fans have complete trust in NFT marketplaces, according to NRG’s survey of 3,250 people. Trust in NFT marketplaces was especially low in Japan, the report noted.
Jay Kaufman said sports fans are, generally, less skeptical of NFTs than the average person. But a vast majority (84%) still want more regulation of an industry that’s as chaotic as the Wild West. In particular, sports fans told NRG that they’d like rules restricting NFT purchases to adults or consumer protections insulating buyers from scams.
“They weren't crazy regulations,” Kaufman said. “Just to kind of control what's actually happening in the marketplace.”
Beyond improving trust, NFT collections must replicate the scarcity and uniqueness of physical collectibles to be successful. Two-thirds (67%) of sports fans say they still prefer physical pieces of memorabilia over their digital equivalents. At the end of the day, NBA Top Shot NFTs may be scarce, but they’re essentially video clips of highlights that can be viewed on YouTube.
To better compete with physical collectibles, sports NFTs may need to offer more tangible benefits and experiences. Perhaps meet-and-greets with players or VIP packages inside arenas.
“[Sports NFTs] have to be something different to continue to grow,” Kaufman said. “Otherwise, it's gonna get stale.” — Christian Hetrick
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What We’re Reading Elsewhere...
- Californians will soon be able to donate to politicians using cryptocurrencies.
- Disney Plus adds "Deadpool" and "Logan" to the platform — its first R-rated films.
- Scientists are developing COVID-19 vaccines that can be inhaled and swallowed.
- L.A.-based game studio Tender Claws workers aim to unionize.