Crypto investment in sports sponsorships soars 3,488%
- Value of crypto and blockchain investment in sports sponsorships now valued at US$605m.
- The global market is expected to grow at a CAGR of 6% from 2021-2027.
- Almost 50% of US sports fans have some familiarity with cryptocurrencies.
Cryptocurrency sponsorship deals are becoming almost ubiquitous in global sports as blockchain-based businesses seek exposure and legitimacy in a world dominated by well-known commercial brands.
The value of crypto and blockchain companies’ investment in sports sponsorship skyrocketed an unfathomable 3,488% in one year, from 32 sponsorship deals in 2020 valued at US$16.86 million, to 188 in 2021 worth US$605 million, GlobalData reported.
Crypto exchanges and other blockchain-related businesses have been pouring millions into sponsorships as an avenue to acquire new customers, and bring the increasingly popular digital asset class into the mainstream.
And in a match made in heaven, sports leagues around the world have been quick to embrace the cryptoverse, as they seek additional revenue streams to stem pandemic-driven losses.
According to global data intelligence company Morning Consult, almost half of all US sports fans polled in a recent survey said they are familiar with cryptocurrency, compared to 39% of all US adults, and just 23% of non-sports fans. Highly engaged sports fans are even more familiar with crypto, as two thirds of self-proclaimed avid fans, as well as 72% of sports bettors, said they are abreast of digital currency.
Reports predict the global sports sponsorship market could grow with a compound annual growth rate (CAGR) of 6% from 2021 to 2027. Last year alone, insurance companies spent a combined US$895 million on sponsorships within sport, a GlobalData Sport report found.
According to Statista, Nike is the world’s most valuable sports sponsor having invested more than US$600 million in sponsorship value in 2021. Adidas followed, with a value for sponsorships of nearly US$343 million.
Crypto sponsorships are still in their infancy. The first official deal signed between a company and a rights holder was in 2014 when US-based crypto payment company Bitpay sponsored ESPN events as one of the first recorded cryptocurrency marketing initiatives.
Just this week, the AFL announced a five-year A$25 million sponsorship deal with Crypto.com, which is a trading platform.
Crypto.com last year signed a record 20-year US$700 million deal for the naming rights to the Los Angeles arena home to the Lakers, Kings, and Sparks that was formerly known as the Staples Center. Last June, Formula 1 landed Crypto.com as a new sponsor in a five-year deal worth more than US$100 million.
Sports as a commercial industry has realised the potential that crypto and blockchain technologies can bring to further monetise fan engagement, attract sponsorship deals, and broaden its appeal globally.
A part of that recognition has been the advent of fan tokens (FTs), which allow its holders exclusive access to sports content, a closer association with their team, as well as monetary rewards. These tokens are a form of digital coin and require making use of blockchain technology from a third party.
Whichever way you look at it, both the sports industry and cryptoverse seem to be kicking goals by teaming up.
Read the full story
in the Grafa app
To read the full article and more in the Grafa app, available on all app stores.
Track the trends
Get the hot tips first
Stay close to your investments
Learn to trade like a pro
Let your money entertain you
See more stories like this
48% of businesses say they will not raise prices, primarily due to the desire to...read more
Of the smaller cryptos, these ones were the movers. Mirrored iShares Gold Trust rose 353.48%...read more
Of the middle-sized cryptos, these ones were the movers. Metacraft rose 66.39% to US$1.31, closing...read more