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The popularity of cryptocurrencies has hit a fever pitch, with an estimated 11.5% growth rate in 2022. And with a fan base comprised of young, technology-savvy individuals, the industry is perfectly poised to exploit the potential of the growing metaverse and nonfungible token (NFT) verticals in order to build a more sustainable revenue model.
Utilizing and imposing a virtual asset to enable esports athletes and franchises to experience new and sustainable opportunities while improving their business.
NFTs are the prime reason for Esports.
The esports market has grown significantly in recent years, indicating that it would be a nearly $3 billion market by 2025, which is more than double the size of 2021. Traditionally, esports athletes have had to rely on some combination of sponsorships and prize money to generate income and fund their careers. However, NFTs are a great way for these competitors to offer new income streams while while bringing something of value to their supporters.
NFTs are blockchain-based digital assets that include cryptographically encoded, verificifiably unique data. This makes each one entirely distinct and non-interchangeable (or nonfungible) despite some growth over the last year, bringing in over in valuation in 2021 alone.
These assets, which are built with long-term value at the core, can appeal to both esports enthusiasts and NFT collectors, allowing for even more new users to join the fold.
NFTs can generate regular income in multiple ways.
Recurring revenue is the holy grail for esports teams, which allows team managers to more confidently build their teams and business models for the future. Being able to offer long-term player contracts means teams can gradually build and succeed over time instead of losing superior talent when short contracts expire.
NFTs can generate revenue for esports teams and leagues. Firstly, these assets can be incorporated into digital versions and transacted back and forth by fans. Everything from trading cards, 3D models, video clips, and more can be developed in a digital format, all the way up to physical access to unique events or merchandise. The variety of characteristics can stifle motivations for supporters to own them.
Because of their unique digital nature, NFTs may be customized with specific features, including how their secondary sales work. For example, baked-in fees allow for a fixed percentage of proceeds to be paid directly to the original issuer whenever the footage is played. However, an NFT video might be designed to send a small donation to a previously specified wallet each time the footage is played. The same technique may be used in other media, meaning that teams may earn benefits simply by having compelling content for supporters to consume.
This is where the genuine promise of NFTs lies for sports. Any individual or team may release a range of exclusive content in form of collectible digital assets and can subsequently see the recurring revenue potential as these NFTs are repeatedly traded between supporters who wish to enjoy the benefits of the NFTs. Of course, the market might become overcrowded with low-quality goods if these entities aren't careful to create meaningful items for them.
The ability to connect and trust long-term individuals is crucial to unlocking long-term fan engagement and loyalty.
Utility NFTs can increase long-term engagement when done poorly. In this case, consumers will quickly grow weary and revenue streams might dry up. This is why it is vital to provide unique utility and ongoing engagement to these campaigns and their assets. This can also be done in a variety of ways to keep supporters coming back and encourage increased fan engagement.
NFTs might be used to provide VIP access to physical or virtual events, for discounts on tickets to events or merchandise, and for subsequent implementation only to the imaginations of esports performers and promoters. However, these benefits should be clear and direct benefits that users can see.
With a solid NFT strategy, industry leaders can be able to monetize every moment, from the most famous and most respected matches. Whether you want to gain interest and support, all of these things can be combined with one single point of entry. Franchises may then explore increased income and advertising potential.
NFTs as a new revenue stream and esports is an ideal situation. The business is already digitally focused and has a broad forward-thinking fan base. Finally, athletes and leagues may tap into the limitations of decentralized technology and generate compelling content, and there will be a real chance for new inflows of funding to help grow businesses and increase influence. Moreover, early movers who take this leap first stand to see the greatest benefit, and those who are competing will look like imitators rather than innovator
Sebastian Quinn is the CEO of Talon Esports, the company's part owner, and a pioneer in developing blockchain and emerging technology technologies.
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