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The role of blockchain in the sports industry
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The role of blockchain in the sports industry

Recently the results of a triathlon competition have been calculated and verified with the help of smart contracts on the Masterchain blockchain platform. And this event was not something unique for the industry.

Mookie Betts Legendary collectible tokens (with the famous baseball player dressed in Boston Red Socks uniform) cost more than 2 mln US dollars each, rare Diego Maradona tokens with images of the Argentinean legend cost more than 4 mln apiece. And there are much more expensive ones (such as Brett Gardner’s virtual fan statue or Lebron James statue, which have been recently evaluated as more than 20 and 35 mln US dollars, respectively). The pioneer creator of the unique sport card series is supposed to be Patric Mahomes with his ‘Museum of Mahomes’, where each digital art piece was sold for 15 thousand US dollars. Such cards can be stored, exchanged or sold not unlike famous physical objects.

Binance Exchange signed a partnership with Portugal ‘Porto’ and Italian ‘Lazio’ football clubs, and since last year it is possible to buy NFT tickets both for single matches and series of games with special discounts and privileges (such as a meeting with a sports legend in person).

Blockchain technologies are gradually capturing this competitive field, which is understandable, as it will help to make the industry more secure, transparent and take away a huge amount of bureaucracy. It may even help to award sportsmen with new categories and prizes in an automated way in future. And much more… But how exactly?

Use cases

There are various cases of how blockchain technology can help to improve the industry, bringing about efficiency, transparency and security which is very important, especially nowadays, in the era of high-tech, when issues go along with innovations. Let’s have a closer look.

  • Tokenization and loyalty programs. Fan tokens are one of the major fields of applying blockchain in the sports industry. First to come were football clubs, which invented loyalty programs for their fans on a blockchain and created fan-tokens. Owners of these tokens could spend them on collectibles, VIP tickets to games and even on voting for administrative solutions. For example, the first batch of $BAR (Barcelona club fan NFTs) was sold out in a couple of hours, bringing the owners special rewards (such as gifts and the possibility to take part in polls referring to their favorite club’s everyday life). Clubs also benefited not only from receiving good wages but also learning their fans better. NFT can also work as proof of ownership of limited edition collectibles. All purchase records can be stored securely on a blockchain. Blockchain technology helps to create special virtual fan platforms for exchanging collectibles and other assets.
  • Tickets’ distribution. Decentralized platforms can be used for the distribution of tickets. The technology helps to manage ticket sales and refunds more efficiently and securely, with smart contracts helping to automate the cancellation insurance procedure (in case of weather conditions or another reason for canceling the game). It is also possible to pay for tickets in tokens issued by the event organizers, or in cryptocurrency. Such tickets work as a proof of ownership and give access to the stadium with no need of buying a physical ticket. It helps to avoid fakes and frauds. Such tickets are also environmentally friendly. All the information about sold tickets is recorded on a blockchain and stored securely there, not subjected to any alteration.
  • Stop doping and other security issues. The case number one when blockchain technologies are used is security. First, it is the security of purchase transactions (ticket sales, collectibles, etc.) and bets. Then, blockchain prevents loss and stealing of sensitive information (for example, the data which users enter to participate in loyalty programs). It also helps to prevent doping and drug crime, which is still a great issue in the sports industry. Using blockchain helps to prevent sweeping cases of doping use under the rug, since records on a blockchain can not be altered. With blockchain, sports organizations have quick and easy access to test records, while sportsmen can upload their medical records and automatically upload their geolocation tags to avoid fines due to absence at random tests. Transparency, which blockchain technology offers, will help to secure all results (medical, competitive, etc.) and bring more justice to the competitions.
  • Stream services. Another peculiar benefit refers to streaming services. There are several problems here (such as low speed, limited network capacity and throughput, piracy, censorship and so on). Blockchain can help to fight them all. The technology can help to stop piracy and data stealing and allows the stream owner to prove their ownership of specific content. It helps streaming companies to prove their rights, get all necessary licenses, and restrict access to certain users (for example, subscribers only, using special keys). Decentralized blockchain nature helps to achieve pure data transmission and avoid buffering. It allows raising the speed of data transmission and reducing costs. A bright example of streaming services using blockchain technologies is DLive, a giant among the communities of blockchain-based live translations.  
  • Cyber sports. Cyber sports is a newcomer in the sports world, but it has almost taken the lead in the race for blockchain technology in the sports industry. Which is to be expected, as they have a lot in common. The first step on using blockchain referred to P2E (Play-to-Earn) type, which was an attempt to help players earn money on their hobby. However, it had certain limitations and did not survive as a cyber sport discipline, being soon replaced by its luckier and more advanced twin brother, P&E (Play-and-Earn), which offered both fun and legal earning. Cryptocurrency is one of in-game instruments there and players can convert all their rewards and earnings into NFTs, which can be sold, bought and exchanged on special marketplaces. Cyber sportsmen take part in tournaments, perform missions and get rewards, which are later converted into NFTs.
  • Bets. It is possible to place bets on blockchain platforms without dealing with traditional intermediaries and sport brokers. There are no minimal bet limits and withdrawal limitations. Stakes can be made in any cryptocurrency available on the platform, the user just has to attach a wallet and choose a currency from the list (which is often quite long). Sometimes to place a bet there one does not even need to download a specific app. All transactions and bets are anonymous.

Sport platforms examples

There are different blockchain platforms applied in the sport industry, helping to find solutions for its specific issues. Among the most famous are the following:

  • TokenStars. A pioneer in sports tokenization. Their goal is to improve and make simpler and comfortable communication between sportsmen, fans and advertisers, using a well-known talent management business model. The platform receives from 20 to 30 percent interest from advertising contracts. The platform issues NFTs which sports foundations, investors and common fans attracted through media partnerships can purchase. The participants of the program can follow the career record of their favorites and even take part in their professional life (for example, vote for contracts). Famous football (and not only football) stars such as Gianluca Zambrotta and Lothar Herbert Matthäus participate in the TokenStars project to attract new people (and can even share their career experience with them).  
  • SportyCo. A start-up for financing and investment in various sport projects and disciplines. The goal of the project is to help young and talented sportsmen to build a career and take over financial barriers which often pose roadblocks on their way. The platform issues its own token based on ERC-20 standards and its currency is represented in huge exchanges (such as LiveCoin). The project is supported by famous football stars.
  • Globatelent. This decentralized platform is somewhat similar to the previous one. Its goal is to support young prospective sportsmen who lack the money to go on with their careers. Platform participants can invest in the career of talented juniors and later get rewards if their favorites are successful. In this case the platform has one special feature: it can work as a kind of a betting system.
  • Cashbet. Quite a famous player in the field of blockchain. The company, previously known as a game platform developer, took part in connecting blockchain and sports along with the British Arsenal. The project issues its own CashBet token, which fans and investors can purchase, and the famous club, on their part, is advertising partnership ICO.
  • TopShot. An ambitious project by NBA and a platform for collectors, developed by Dapper Labs. Participants capture moments (or short videos) with spectacular basketball stars’ playing and those moments are collected on cards with stars’ names (can be common, rare or legendary). The moments are presented only by platform owners and it is impossible to upload other videos there. The cards serve as unique NFTs and can be sold or purchased at the marketplace.
  • Sportbet. One of the popular platforms for betting on sports, built on EOS blockchain and accepting stakes in different cryptocurrencies (such as BitCoin, Ethereum, EOS, etc.) and users can choose one of 14 sports disciplines. The platform issues its own SBET token for possible investors and offers several stakes types as traditional betting systems do. The average interest for top matches is about 6 percent. However, the platform (as other betting platforms) has limitations (represents mostly top matches from 35 countries).

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