They are not the first but far from being the last. The French Tennis Federation (FFT) is launching, on Tuesday May 17, its first collection of NFTs in pre-sale for its licensees, before a public sale on Thursday. The NFT, acronym for the English “non-fungible token”, which means in French “non-fungible token”, are the new business that is panicking the sports community.
Clearly, NFTs are digital objects that can take several forms such as an image, a map or a video. Each edited NFT is unique. In order to guarantee their authenticity, these NFTs have tamper-proof titles of ownership, based on blockchain technology (the one that identifies cryptocurrency exchange transactions). Most of the time, NFTs are sold on dedicated platforms and the purchase is made in bitcoin or ether, two of the competing cryptocurrencies. As with works of art subject to ratings, NFTs can be resold and appreciate in value.
NFTs have established themselves as real investments, well beyond sport. the The main NFT transaction site, OpenSea, went from a few tens of millions of dollars in NFT sales at the start of 2021 to more than 10 billion dollars in November of the same year, a record.
“Apart from finance and the ‘tech’ sector, luxury and sports are the sectors that invest the most in NFTs.”Julien Pillot, economist, teacher at Inseec and specialist in technology markets
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Why ? “Simply because they have the most obvious application areas”, retorts Julien Pillot, economist, teacher at Inseec and specialist in technological markets. Like any investment, NFTs are not without risk and depend on speculation. Indeed, when you buy an NFT, no one can say how its value will evolve. In the same way, cryptocurrencies, which allow exchanges, depend on a volatile price.
This argument, however, did not discourage the sports community. Since 2018-2019, more and more players in the world of sport, clubs, sports federations or athletes, have been investing in these digital assets. For the time being, only highly publicized sports have tried their luck such as football, rugby, basketball, tennis or even cycling.
In 2021, the NBA launched its collection of NFTs in the form of video extracts of a few seconds showing game action that marked the history of the American league. The French start-up Sorare has had great success with its collectible NFT cards of some 6,000 footballers, also known as virtualized Panini cards. This company was valued at nearly 4 billion euros in the fall of 2021.
The FFT is launching its collection of 5,000 NFTs on Tuesday, May 17. Each of them will represent a numbered seat of the Philippe-Chatrier court, with a unique design for each. Specificity of this project: the purchase of NFTs will be made, not in cryptocurrencies, but in euros by credit card on a dedicated Roland-Garros site. “We are deliberately cautious on this project, we don’t want to rush things and take risks in mechanics that we don’t yet know well”, specifies Amélie Oudéa-Castera, general manager of the FFT.
Unlike derivative products which are only sold once by brands, NFTs can be resold to infinity. And the whole point is that with each resale of the NFT, the creator can receive a percentage. “An NFT is a computer program, which is worth a contract. The creator of the NFT can issue the rule that with each resale, the club and/or the player whose image has been used, recovers a percentage of the amount committed” , explains the economist Julien Pillot.
“Each project has its strategic objectives. NFTs and blockchain are just one technology. Depending on who you are and what your goals are, you will use them in different ways.”Julien Pillot, economist and teacher at Inseec and specialist in technology markets
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Indeed, qhen the NBA broadcasts the best moments in the history of the league on video in the form of NFT, its objective is both to find an additional communication channel to get the NBA talked about, but also to find sufficient additional income. substantial.
If NFTs are a a means of creating new sources of income for clubs and federations, they do however have other advantages. “NFTs also make it possible to create fan engagement around brands, especially with those who are distant, who are not used to going to the stadium and who consume sport differentlyand this is a real challenge today for clubs and competition brands”, develops Magali Tézenas du Montcel, specialist in sports economics, and general delegate of Sporsora (reference organization for thinking about and influencing the development of sports economics).
For this, the purchase of NFT includes, in most cases, exclusive advantages for the holder. A way to create a digital link with the fans, and to integrate them, more or less, into the life of the club or a competition. This is the challenge of the NFT project launched on May 25 (in pre-sale, on the 26th for public sale) by the Sedan Ardennes Sports Club, a football club playing in National 1.
“Our goal is to create a crypto-community, testifies Marc Dubois, the president of the club. We favor digital approaches because we are in a territory with a limited population, and this operation is clearly part of an approach to enhance and promote the club, for its development. The purchase of one of the 11,011 unique NFT cards from 0.05 ethers (i.e. 133.99 euros) bearing the image of the club’s mascot, the Ardennes boar, will allow purchasers to benefit from gifts, participate in contests or participate in physical and virtual events of the club.
The objective is the same for the French Tennis Federation. Buyers of a digital seat on the Central will have access to a club in which a series of exclusive advantages will be reserved for them: possibility of winning match points played on the Central during the 2022 edition, VIP tickets for Roland- Garros and for the Rolex Paris Masters, personalized visits to the site or meetings with players from the circuit.
Stade Français, the first Top 14 club to join the NFT last March, chose another option. After offering cards bearing the image of the club and its players for purchase, the club wants to go further. “Our NFTs will be backed by a fantasy game (game where participants take on the role of sports team owners, and challenge other players based on the results of real players and teams, editor’s note) for next season, a first in the oval, announces Georges-Henry Bediou, director of development and communication for the club. The cards will have a dual function: a collection role, which is the traditional role of NFTs, and they may also have a role in the game.”
SponsorLive x @SFParisRugby
The capital club is proud to join this new technology to offer its supporters, rugby lovers and collectors the first NFT (Non-Fungible-Tokens) cards!#SFParis
– French Stadium Paris (@SFParisRugby) March 24, 2022
A double function which will therefore bring additional value to these NFTs depending on performance. “We can coat this with a whole bunch of little marketing talk, like creating a new community or attracting new audiences, but the reason for these various projects is above all financial”, argues the economist Julien Pillot.
These new communities are of interest to both large and small clubs, and for good reason, since an extended community is a major asset in front of sponsors. “If your fan base is larger, you will monetize it with partners, and this will indirectly generate revenue for clubs”, translates Magali Tézenas du Montcel, specialist in sports economics.
Moreover, the NFT approach is part of a broader logic, that of the diversification of the sports economy. “The economic model of football clubs needs to be rethought, whether professional or amateur. All clubs are in trouble. notes the president of the Sedan Ardennes Sports Club, Marc Dubois.
“At Sedan, if we hadn’t started an innovation process, the club would have a hard time surviving.”Marc Dubois, President of the Sedan Ardennes Sports Club
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If the covid pandemic and its financial repercussions have been able to trigger certain dynamics, “However, nothing demonstrates a cause and effect relationship for this enthusiasm for NFTs”, supports the economist Julien Pillot. “Lhe overriding factor of our project is this increasingly bubbling innovation in the world of NFTs. We didn’t want to be left out.” recognizes Amélie Oudéa-Castera. Next step, the metaverse, in other words the virtual world, that sports players are beginning to appropriate? “That is indeed the next thought. Metaverse is part of our roadmap.” The world of sport has therefore not finished reinventing itself.