The National Football League is the latest to introduce the expansion into the world of blockchains. It sent out a memo a few weeks ago stating that NFL teams can find potential blockchain sponsorships for the upcoming season.
This ruling is a change of heart from league offices, which banned deals around cryptocurrency and NFTs right before the opening week.
For those who are unaware, a blockchain is a form of a digital record book of transactions across a network of computers. It encompasses cryptocurrencies like Bitcoin.
Now that the NFL conducted its assessment of the technology, teams can begin finding new partners for 2022. The decision also follows reports that the league lobbied the Securities and Exchange Commission for six months last year.
It spent a total exceeding $600,000 in petitioning both chambers of Congress, among others.
Although NFL teams can’t utilize blockchain sponsors through stadium signage, it’s a major step to move into this space.
While crypto promotions based around fan engagement remain restricted, it seems like things are headed in that direction. Given the pivot from the NFL on gambling, when money is involved, moves like this aren’t surprising.
Throw in the possibility of legal Texas online sports betting in 2023, this is just the start of major change when it comes to sponsorships and the NFL (especially in the Lone Star State).
NFL moves into blockchain sponsorships
In addition to teams having the ability to seek out new technological sponsors, the NFL’s memo said teams can also secure limited permissions on NFTs.
NFL Chief Revenue Officer, Renie Anderson, and Chief Media and Business Officer, Brian Rolapp, delivered the notice.
Part of the agreement in place is that any partnerships with blockchain companies are limited to just three years. The NFL’s head of consumer products, Joe Ruggiero, discussed how this gives the league some “flexibility for the long term” and optimism about this latest venture.
According to CNBC, Ruggiero said:
“We’re extremely bullish on blockchain technology. We think that it has a lot of potential to really shape innovation, shape fan engagement over the course of the coming decade.”
Before diving in headfirst, the NFL wanted to ensure what it was potentially tying its brand to in terms of blockchains. The memo stated:
“In this evolving regulatory environment, it remains essential that we proceed carefully when evaluating potential commercial opportunities involving blockchain technologies, and conduct appropriate diligence on all potential partners and their business models.”
The league’s slight hesitation in regards to this progress is evident based on the contract limitations to three years and the lack of blockchain signage.
Still, this opens the door to a lot of other potential endeavors down the line. Given how important fan engagement is for teams and leagues, any way to get an advantage will eventually get considered.
Cryptocurrency deals in major American sports leagues
Besides just individual NFL teams branching out into blockchain partnerships, the league as a whole is considering a move. Its official blockchain rights could bring in a massive figure.
In October 2021, the NBA struck a deal with the cryptocurrency company Coinbase. Over four years, the sponsorship provides $192 million for the league.
It’s likely the NFL would generate an even bigger agreement.
As far as teams go, the NBA set the initial precedent there, as well. The Golden State Warriors signed a contract with the cryptocurrency platform FTX in December 2021, netting them $10 million for their international rights.
Then there’s a slightly different avenue that’s closely related to NFTs.
The NFL already has a partner in place, announcing its plans right before sending out this latest memo. The league, along with the NFLPA, formed a collaboration with Dapper Labs to produce exclusive digital video NFTs that include highlights of the best plays from the season.
By using Dapper Labs’ “cutting-edge blockchain technology,” the NFL is allowing fans to obtain these collectible moments.
That’s not the only NFT deal in place, either. The NFL also utilizes Panini for NFT trading cards.
Fans may have noticed that the league allowed its media partners to feature ads regarding blockchain companies last year, too.
Players get in on the action
There are also lots of players getting involved.
The NFL co-owns Fanatics, which recently invested in the NFT brand Candy Digital. One of the company’s investors is Hall of Fame quarterback Peyton Manning.
Others like Tampa Bay teammates Tom Brady and Rob Gronkowski are in the NFT space, with Brady’s “Autograph” earning plenty of funding in January.
Of course, the NFL plans to keep considering everything included with such an evolving market. Ruggiero said:
“Everything is changing so quickly – we all have to be looking at the next areas of innovation. So, we’re spending a lot of time looking at where the future might go.”
It appears like this is just the beginning for the NFL and other sports leagues in terms of relationships with blockchain technology.