The latest trends in the crypto industry are sports sponsorships in football, Formula 1, UFC, eSports, and baseball. Multi-million dollar investments in sports deals by crypto businesses are primarily aimed at building legitimacy and engagement with sports fans. According to sports analytics firm Nielsen Sports, crypto transactions with sports teams and leagues grew by more than 100% in 2021 and are expected to reach $5 billion by 2026.
The growth of Bitcoin, Dogecoin, and Shiba Inu is largely due to the large communities behind the projects. Crypto businesses have come to understand the importance of having a large community behind a project. A large community helps market the project, attract developers of decentralized applications (dApps), raise funds for new dApps, and drive the token or token price through the resulting demand.
In February, Manchester United Football Club announced a multi-year sponsorship deal with Tezos worth $27 million a year. Under the agreement, the Tezos brand will appear on the football team’s pre-match warm-up jerseys. Tezos also sponsors McLaren Racing, which operates teams in Formula 1 and IndyCar.
On Friday, Manchester City Football Club announced a sponsorship deal with OKX (formerly OKEx), which will add brands to the Etihad Stadium and the Academy. This may be OKX’s first sponsorship deal in sports, but it’s also an important indicator that crypto companies are finding significant value in sports deals.
In Formula 1, Red Bull Racing has signed a 3-year sponsorship deal with cryptocurrency companies Bybit and Tezos as its official blockchain partners, Alpha Romeo F1 Team is sponsored by cryptocurrency company Floki, and Scuderia AlphaTauri Team is sponsored by Fantom Blockchain Sponsored, the Scuderia Ferrari F1 team has partnered with crypto company Velas Network AG, while the official title partner of Formula One is crypto exchange Crypto.com.
During the Super Bowl LVI in February, crypto exchanges FTX, Crypto.com and Coinbase purchased 30-second spots for $6.5 million. The most high-profile deal in basketball was the $700 million Crypto.com deal to rename the Los Angeles Lakers’ arena as the Crypto.com Arena. Crypto.com also signed a $175 million sponsorship deal with the UFC to put its brand on the apparel worn by UFC athletes. This is a clear message that crypto companies are willing to pay high prices to take advantage of the benefits of sports sponsorships in 2022.
Binance, the world’s largest crypto exchange, has made a number of notable deals in the sports sector. Among them, in January, it sponsored the TotalEnergies African Cup of Nations (AFCON 2021), sponsored the Argentine Football Association (AFA), and cooperated with the Alpine F1 team to build a platform (NFT) for fans to buy non-fungible tokens. Binance also sponsored a fan token platform with Italian football club Lazio.
The sports industry is constantly exploring new synergies with the crypto industry. For example, Manchester City Football Club is building the world’s first virtual world football stadium to help fans watch matches online. Additionally, sports teams have seen the rise of fan tokens that drive fan engagement and relationships with their teams. Fan Tokens are cryptocurrencies tied to a specific team or league and used to exchange team-related value such as buying tickets, voting on club affairs, offering discounts on merchandise, and building engagement in the fan community. Fans such as Atlético de Madrid, FC Barcelona, Paris Saint-Germain, AC Milan, Juventus and Roma have issued fan tokens.
There is no doubt that sports has a broad young demographic, yet the field has been the target of other non-crypto brands like Red Bull and Coca-Cola for years. According to Nielsen Sports’ 2022 global sports marketing report, Fans Are Changing the Game, there has been an increase in awareness and interest among people watching sports brands in the crypto industry.
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