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Can blockchain team up with the sport industry to make sports better overall? Here's my take on this. As always, don't forget to share your thoughts, ideas, and criticisms in the comments below. Originally published on stealthex.io (https://stealthex.io/blog/2020/11/10/blockchain-and-sport-industry-are-they-an-effective-team/)

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In Brief

The blockchain tech can be instrumental in many problematic areas of the sport industry. For example, one of such areas is ticketing, more specifically ticket scalping and counterfeit tickets. And this is exactly where it has already proved quite useful as the real-life use cases demonstrate. Another interesting area of application is fan tokens, which are to make fans and clubs closer to each other

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In Full

In one of our previous (https://stealthex.io/blog/2020/09/22/can-blockchain-gaming-drive-cryptocurrency-adoption/) articles on a mutually beneficial relationship between blockchain and the gaming space, we came up with the number of gamers in the world reaching a whopping 2.5 billion people. But even this number pales in comparison with the popularity of just one sport – association football, commonly referred to as soccer.

Its fanbase is estimated to be around 4 billion people, which is, for a moment, more than half of the Earth’s current population. In this manner, the entire world can be considered a target audience for the sport industry, barring infants and a negligible number of haters. So how can blockchain team up with this industry to make sports more entertaining and exciting?

Building a better experience with blockchain

To get us started, let’s briefly recall what the sport industry essentially is and what it strives to achieve. Fundamentally, it belongs to an entertainment sector of the economy, and as such, it pursues the aim of entertaining the public and, hopefully, the participants as well in one way or another through competitions, tournaments, sporting events, and related activities like fan conventions and gatherings. It may take different forms, which came to be known as, well, sports, professional and amateur, that are appealing to different types of fans and, more broadly, viewers and spectators.

In this fashion, it all eventually comes down to “user experience”, and if blockchain can make this experience better overall and more rewarding to interested parties, be it fans, athletes, teams, or clubs, we can then rightfully consider its job well done. With that established, we can now look for the areas of the sporting world where blockchain can produce a difference, and still better a real change. But even without delving into specifics and particulars, we can say beforehand that blockchain will most certainly turn out useful in the industry’s most problematic areas.

Not convinced? Perhaps an example or two will help. Sporting event ticketing has always been a huge pain in the neck for the entire industry. In fact, the problem is, in the very least, twofold. The first primary source of pain for an inveterate sports fan is counterfeit tickets. Before blockchain, the best advice out there was to only purchase tickets from a reputable source. As advances in technology enabled the superior quality of fake tickets, an average consumer is no longer able to check the authenticity of tickets and verify whether a ticket is legitimate or counterfeit.

The second source of intense suffering lies in authentic tickets resale, colloquially known as ticket scalping. If you are not someone with necessary connections or part of the inner circle of a famous athlete or club, if you are just a regular fan like the guy next door, you are unlikely to buy an admission ticket to a major sporting event at its face value. To add insult to injury, the event is quickly announced "sold out" once the tickets are no longer available through the official box office, which allows the avid and unscrupulous resellers to inflate prices in hopes to make a killing and rake in some serious profits.
 
And what do you think? Blockchain effectively deals with both of these issues and offers immediate benefits in this department. If event organizers are using a blockchain platform for ticketing and there are only so many tickets to be sold on it, no room is left for counterfeit tickets as you can’t counterfeit the entire blockchain. Well, technically, you can, but in that case looking for counterfeiting tickets will be your least concern as it might turn prohibitively expensive and counterproductive.

If you put a little more effort into it, you can easily leverage the blockchain tech for fighting off ticket scalping as well. The solution that the blockchain ticketing startup from Amsterdam called GUTS (https://guts.tickets/) uses to address this activity is simple and straightforward. Every ticket is now associated with the buyer’s mobile phone, and if an event organizer prohibits reselling, tickets can’t be resold, as simple as it gets. On the other hand, if it is allowed, you can only resell tickets at the original selling price, which again leaves no room for scalping.

As you can see, blockchain can markedly alleviate the life of a simple sports lover and thus add to his positive experiences, making the sport industry as a whole a little better overall. Now UEFA is going (https://www.uefa.com/insideuefa/mediaservices/news/025a-0f8e753e5b69-12cc5167a50a-1000--over-one-million-uefa-euro-2020-tickets-to-be-distributed-to-fa/?referrer=%2Finsideuefa%2Fnews%2Fnewsid%3D2638651) to sell its tickets via a blockchain-enabled mobile application – after the coronavirus pandemic has been dealt with. Until then, we will explore other important areas where blockchain and the sport industry can make an effective team.

How to make an effective team

We started this exposition by mentioning that there are 4 billion fans of association football. This is a huge fanbase by any metric, and it comes as no surprise that it gave rise to blockchain-based platforms trying to harness the distributed ledger technology and tap into this immense market. Online sports-oriented platforms like Chiliz.net (https://www.chiliz.net/) and Socios.com (https://www.socios.com/) are looking to change the ways fans and clubs interact enabling more intense connection between the fans and their favorite teams. So how is it possible? Enter fan tokens.

As it turns out, the fanbase of the biggest soccer clubs in the world, say, Spanish Barcelona and Atletico or Italian Roma and Juventus, is scattered around the world, and most fans have never visited in person even a single match of their beloved teams. Fan tokens are a way to meaningfully engage this global fanbase. Having a fan token is supposed to give its holders certain voting rights in club-specific polls and thus produce a feeling of belonging, apart from directly supporting the club financially by buying these tokens.

Technically, fan tokens are regular ERC-20 tokens on an Ethereum Proof-of-Authority sidechain. The platform also designed its own Chiliz token operating on this blockchain, with which it is possible to trade fan tokens of different clubs indirectly against each other at a market price based on demand and supply. In other words, Chiliz and its clients are trying to leverage the blockchain to monetize the fanbase in exchange for fan-centric activities that possession of each fan token allows.

Another avenue of monetizing the global fanbase via blockchain involves officially licensed digital cards of players. The fantasy football platform Sorare, created in early 2019, by now have entered agreements with over 100 clubs including Paris Saint-Germain, a top-tier team from France, to produce virtual cards for players. Every card is a digital collectible – most certainly an NFT under the hood. Fans can collect, trade, and use them for different gaming activities, and they can even hold fantasy football tournaments. So CryptoKittish.

On the other side of the pond, a couple of NBA teams decided not to fiddle with the blockchain tech but instead embrace cryptocurrencies as a whole by allowing their fans to pay for tickets and other stuff with Bitcoin. In fact, one of these teams, the Sacramento Kings, have been doing this since 2014, while the other team, the Dallas Mavericks, started to accept the cryptocurrency in 2019. Litecoin is also welcome in America – a year ago it was named (https://www.miamidolphins.com/news/litecoin-named-official-cryptocurrency-of-the-miami-dolphins) the official cryptocurrency of the Miami Dolphins, an NFL team from Florida.

We're an effective team!

It is somewhat ironic how the coronavirus pandemic forced lots of sport clubs across the world to seek out new ways of interacting with their fanbase. Blockchain turned up quite handy in times like these and enabled diminishing the social distancing brought about by forces mostly out of our control. Is this the beginning of a mutually beneficial partnership?

As they say, there is no cloud without a silver lining, and it looks like blockchain and the sport industry can make a superb team once there is a will coupled with a necessity, the mother of invention. And let’s hope that this team will make happy its supporters from both camps – the blockchain community and the sporting world, and not just for the time being.

Of course a fruitful combination we had the Chiliz project is the world's leading blockchain fintech provider for sports and entertainment. The adoption of blockchain in this industry will create transparency and promote tool-based monetization to monetize and increase engagement. Maybe in the future, we will have a few new projects. In Chiliz's case the most important partnership role, it might take them a lot of time and money to convince the clubs to choose them as partners.

They already have a few high-profile clients

If we are talking about soccer specifically, their customer list now includes such grand names as Barcelona, Juventus, Atletico, Paris Saint-Germain, among others. And as I'm inclined to think, in these dark times many more clubs are going to utilize this novel model of interaction with their fans. I can't really say that I'm a big soccer fan myself, but if I were I would be interested in this thing. In case of Barcelona, for example, 600k fan tokens were sold out in less than two minutes during the so-called Fan Token Offering in June 2020. The takeaway is that they shouldn't have a shortage of clubs lining up

It can be guaranteed that scam in selling tickets will not occur in many ways, which will make it practically difficult for those who want fraud to continue with it. Blockchain is one of these methods, but it is not the best one.

In fact, the use of blockchain wastes a lot of energy, which will not be of value in regular projects, so the important aspect that the blockchain can contribute to is the financial and economic aspects.

Nor is it necessary to solve problems using blockchain?

In fact, we already have a few use cases of blockchain application in this filed (I posted links in the article). For example, UEFA was going to distribute tickets to EURO 2020 via a blockchain-based mobile app:


Indeed, the coronavirus pandemic postponed this effort, probably even canceled it, but we can't say that it has failed due to its own faults and limitations. Anyway, when things eventually get back to normal, we will see

Actually, it's not the first time they're doing this.

A couple of years ago, they launched an app (probably an older version to the one they'll use soon) to sell tickets ^[1] in specific matches. But that was more to test the waters with the blockhain technology. I think after the next EURO, this type of system will become the norm in football, it's about time they start moving away from the regular ticketing systems.

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1. https://cointelegraph.com/news/union-of-european-football-associations-implements-blockchain-based-ticketing-system

Actually, businesses like Chiliz will have great potential in the future if the crypto market is recognized worldwide.  At that time, Staking Chiliz token was also an indirect way to invest in big football teams and earn passive profits. Projects investing mainly in Sport are not a trend now, it takes many more years to demand greater investment, so it wont be an effective team now .

Hello
I did try to read as much as I can but I believe that's a real good work on analyzing how it can be used. Now I would like to express my opinion.
I believe blockchain and cryptocurrencies can be used anywhere in the world , taken the usage and effectiveness is taken into consideration.
When we talk about sports industry , it have a lot of scope for sure. Even right now many governmental bodies have allowed the sport gaming Industry involved in gambling to go online , this is giving them revenues at the same time it's good for the people too since they can avoid crowded spaces altogether.
- Transparency is a factor but at the same time if would actually deprive the people involved of privacy.
- people can involve themselves by investing in their teams and players through cryptocurrencies, this way one can also have international investors
-partnership and tokenization is already taking place in the industry
- it's not just betting and gambling but we are discovering new things every day.

Another potential niche market: blockchain validated autographed sports memorabilia and collectibles. Another layer of validation to help reduce forgeries and elevate the value of authentics.

One controversial area I wouldn't mind blockchain tackling is fantasy sports. Technically its a game of skill, rather than gambling. It should be legal as other games of skill are. However many states and bureaucracies have taken it upon themselves to illegalize fantasy sports, in spite of this. A blockchain based fantasy sports platform similar to thepiratebay would be cool. Although perhaps no longer feasible in this day and age. There is also a good market cap in fantasy sports judging from the example of fanduel, draftkings and other existing platforms which afaik do multi million dollar volume transactions on a daily basis.




Good to hear. I did not know that.   :)

Mixed martial arts has a few bitcoin and crypto representatives. I think Rory MacDonald was sponsored by dash coin for awhile who could have paid him as much as $200,000 in sponsorship per fight. Firas Zahabi of tristar MMA gym and Ben Askren are also pro crypto.

Blockchain technology in itself is big so for your ideas it may work but maybe it may not. Like when you said the idea about "fan tokens" I think that this might not be an effective way or something useful for the fans to use for their football clubs what I mean they already have ways to join polls in social media and also have a solid fun club to go with it, issuing something like this token might make them feel that this is some kind of gimmick for them. But for the use of blockchain with regards to improving their system like what you said with the ticketing issue and how to avoid scalpers I think this is one of the most effective ways of applying blockchain technology.

Interesting.
I would suggest that they (or any similar companies) make sure that fans/users are able to easily run full nodes and really own their coins/tokens/NFTS.
I wonder if the fan vote/poll will affect clubs if they are of good qualities. I would also suggest a real consensus mechanism that score fans based on the quality of their votes(votes with comments attached). Fans with consistently quality votes will have votes that can change the way the clubs/teams they support are run.

We could also recall Dogecoin

And the efforts of its early community to raise funds for various athletes and teams. In 2014 the community started a fundraiser to sponsor the Jamaican bobsled team that lacked the means to go to the Winter 2014 Olympics. Then it successfully raised funds for Josh Wise, a NASCAR driver. This made some noise in the crypto circles (I remember the discussions here on BCT)

Esports is a great team with the Blockchain. I am not saying that it can't be applied to sports but I am seeing great potential for its application in the world of esports and online games. People can't just deny how this is growing so much and its fanbase is hugely growing time after time. I think it would work with great game developers getting onboard.

Whether Blockchain or not, the sport industry will be doing fine and fans are already having good connection with their favorite sports club. But the club token you have mentioned seems to be a really good idea, wouldn’t be a bad idea if sports clubs will be able to reward their fans for their loyalty. They can set up a store online and close fans who make use of their website will earn tokens that they can redeem for prizes on the store.

The ticketing one is probably the easiest application of blockchain in the sports industry IMO. Even though most ticket sales are already through digital means, there are still cases wherein counterfeit tickets are being sold and being accepted on the event day just because they are easier to tamper with, as compared to the blockchain one. While in essence, blockchain could just mean 'database' after all, the added security offered through cryptographic means makes the said ticketing system more secure plus more efficient at the same time.

Well, these are not quite my ideas

I only looked into what already exists about blockchain tech in sports. You seem to forget that most fans have never been to a real game of their favorite team. In fact, many fans have not even been to the city or even country of their passion. For example, European football is very popular in East Asia, so how can fans from that region interact with the club if they are thousands of miles away? Blockchain is capable of making this distance shorter, in a way, and also facilitate that feeling of belonging much better than social media presently does


Yeah, that seems to be a very interesting and important use case

Blockchain effectively deals with both of these issues and offers immediate benefits in this department. If event organizers are using a blockchain platform for ticketing and there are only so many tickets to be sold on it, no room is left for counterfeit tickets as you can’t counterfeit the entire blockchain. Well, technically, you can, but in that case looking for counterfeiting tickets will be your least concern as it might turn prohibitively expensive and counterproductive.

That is just one part of the benefits of bitcoin and sport industry mutual relationship, they are also a good advertisement for bitcoin as we all know that sport industry have a lot of audience and an advertisement placement is a good advantage for any product or services involved. This will in turn make people checkout bitcoin more than ever because they support the sports industry so they might as well support what they are promoting.

There was a particular time in the not so distant past when the blockchain technology was kind of prostituted. That was the time of the ICO craze. Everything was offered in a tokenized version using the blockchain. That included ticketing. I remember the names Aventus, Get Protocol, EventChain, and many others. They were said to address ticketing issues like scalping, reselling with a ridiculously higher price, counterfeiting, and so on. Well, I haven't heard much of them lately.

What would be also important to note is that those blockchains solutions have so much in common with bitcoin's blockchain a seal and a parrot.
For example, the UEFA ticketing system was nothing more than a centralized database that carried a unique id you could check for its validity or transfer to another account at any moment and that would be activated on an entry into the stadium.
Blocks? Mining? Transactions? Decentralization? Nothing like that.


I think that the trend of naming anything that looks like a database a blockchain is coming back again in full swing.
A blockchain solution as some are marketing can be energy efficient, the only thing is that the solutions they implement are nothing like the blockchain we imagine, they are resembling a lot more to traditional distributed databases, Cassandra is one of those, a fully distributed database, nothing more. None of those are resembling bitcoin, every single of them can reverse any data stored in it.

As for tokens, yeah, crypto kitties.


Well, we got rid of prostitution for a while but DeFi is here to rake in some cash from the gullible wanting to be the next "early investors"

Stating that there are 2.5 billion gamers and 4 billion football fans around the world is quite a big exaggeration.
I think that the vast majority of those 4 billion football fans had never bought a ticket or a football t-shirt in their lives. ;D
I don't believe that counterfeit tickets are a problem in the sports industry.AFAIK,in most of the big European football leagues,people who buy tickets can enter the stadium only after they provide ID card.Do you think that people can enter the stadium providing a fake ticket AND their ID card?
Maybe some day the blockchain will be used by the sports industry,in one way or another,but the process of implementation and innovation will take a while.

It's gamers, not gamblers. I think if you have a smartphone, you already are a gamer, to a degree. Do you never play on your smartphone or do you not have one? Regarding sports fans, I tend to think it is safe to say that half of the human population are fans of some sports. For example, I'm a fan of figure skating. Ladies' singles, more specifically. And boxing. Except women's, of course. And while we are at it, do you know how t-shirt is called in Russian (https://translate.google.ru/#view=home&op=translate&sl=en&tl=ru&text=t-shirt)? "Фyтбoлкa". Yeah, football t-shirt, as per literal translation

I buy some every now and then (and wife beaters too)

Everyone forgets about the scouting process as well and that is a very important part in the sports world as well. If you could have a blockchain to have all players as an address for example, you could create one for each player in any sport and you could have the biggest sport scouting network in the entire world. Blockchain world is so big that you can literally have just one blockchain for ALL sports and that would allow teams to scout players however they want and search for it.

I understand that nowadays with football manager and transfermarkt and stuff like that, there are not many places that is unscouted and scouting world became so huge and connected that it may not "need" this but it could certainly improve on the current situation for tech reasons even if not scouting reasons.

If I'm not mistaken, someone has already done something to that tune

Someone named Michael Schwimer, a former baseball pitcher, who designed a blockchain-based solution to invest in young and aspiring prospects when they are still relatively unknown outside their circle so that everyone could get a portion of their future earnings once they hit it rich. I don't know how he's doing now and whether his plan took off at all

couldnt find the project that youre referring here. but that kind of blockchain based project should be one that get funded from sports industry. seems that particular project didnt prosper. but the aim is great.
if only some sport organisation will realise its significance to the younger generation

but blockchain and sports industry is really a good match if explored properly. like for example, in the sports ticketing industry, blockchain will create transparency and will reduce pre-sale and re-selling problems, like overpricing. maybe blockchain tech can really solve some of the long running problems in sports industry but it would take a strong platform to make a change and really pursue their mission. because some projects are good at the start but most of them cant sustain its activity

Not the only blockchain-based project in the world related to sports but most recent reports relate to the field of sports for example initiatives can be given here based on online fantasy football special blockchain based statues in another project of this kind is the fan token society which enables fans to influence the decisions made by famous sports clubs. The world of sports therefore appears to be an ideal field for testing blockchain based enterprises and thus introducing innovative unprecedented solutions teams are much more effective if each scouting allows players to be based on a blockchain.

My idea wasn't really anything regarding making money from someone else who would play. My idea was just a scouting report type of deal where someone from Ghana and someone from Taiwan could find players from each other's country thanks to blockchain. If you want to talk about premier league teams they have enough scouts all around the world trying to find as many players as they can and watch as many games as they can. Hell I know someone working in my nation for Football Manager and even that is enough most of the time.

However with this blockchain very very poor teams who normally can barely afford to keep the lights on, could use this blockchain to scout for talent both in their own country or even outside that are from places nobody heard from and normally wouldn't be found. Think of like 4th division of one low level nation transferring from 5th division of another third world country.