The National Football League in the U.S. has given the green light to teams to solicit sponsorship’s from blockchain companies. The teams are not allowed to promote specific cryptocurrencies, nor are they allowed to peddle fan tokens.
This move is understandable, considering the Advertising Standards Authority’s ban on Arsenal FC’s fan token, citing the alleged misleading of fans regarding cryptocurrency investment risks. In addition, the CEO OF Socios exchange, which houses most fan tokens, was recently accused of price manipulation.
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This marks a reversal of rules ratified late last summer where teams were prohibited from selling sponsorship’s to crypto firms and non-fungible tokens. The League said it decided in favor of permitting “promotional relationships without undertaking excessive regulator or brand risk,” following an investigation into cryptocurrencies. They had also been lobbying the Securities and Exchange Commission, the White House, and the departments of Justice and Commerce on “issues related to blockchain technology” from July to December 2021. “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,” said an NFL memo issued by Chief Revenue Officer Renie Anderson and Chief Media and Business Officer Brian Rolapp.
NFT adverts will also be allowed
In 2021, the NFL allowed blockchain advertisements to run during its games. Now, they will enable non-fungible tokens and associated companies to advertise during their games. The memo notes, “Subject to League approval, Clubs may now accept advertising (without use of club marks and logos, unless in connection with a League NFT deal) for NFTs and NFT companies.” The NFL and the players union inked a deal with blockchain company Dapper Labs to create video memorabilia, not dissimilar to the National Basketball Association’s TopShots collection.
It’s not clear how much NFL crypto partnerships would be worth. The National Basketball Association struck a four-year, $192M deal with Coinbase. At the same time, FTX inked an agreement with the Golden State Warriors worth $10M.
Everything is changing so quickly, says product head
NFL’s chief of consumer products, Joe Ruggiero, said that the deals with crypto firms would not last longer than three years, granting long-term flexibility, in contrast to the 20-year agreement FTX struck with the LA Staples Center. “We’re extremely bullish on blockchain technology. We think it has a lot of potential to really shape innovation, shape fan engagement over the course of the coming decade.”
Ruggiero says that the League would continue to investigate various limitations placed on crypto deals detailed by the memo.
“Everything is changing so quickly – we all have to be looking at the next areas of innovation,” he said. “So we’re spending a lot of time looking at where the future may go.”
Tom Brady has launched his NFT collection on his Autograph platform, making room for fellow NFL player Rob Gronkowski, hockey star Wayne Gretzky, and tennis star Naomi Osaka. Autograph raised $170M in January, according to Bloomberg.
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