The NFL has reportedly banned its teams from participating in sponsorship deals with cryptocurrency trading firms. This ban includes the auction of NFTs, but excludes sponsorships from companies that may have a connection with cryptocurrency as long as this sponsorship is focused on the company’s corporate brands.
While a number of leagues and sports teams around the globe have collaborated with crypto companies in the creation of non-fungible tokens and exclusive sponsorship deals, the National Football League has expressed more caution when it comes to participating in this industry.
“Clubs are prohibited from selling, or otherwise allowing within club controlled media, advertisements for specific cryptocurrencies, initial coin offerings, other cryptocurrency sales or any other media category as it relates to blockchain, digital asset or as blockchain company, except as outlined in this policy,”
A team official added that, while teams cannot sell sponsorships to cryptocurrency trading firms, they are able to have sponsorships from “companies whose primary business is providing investment advisory and or fund management services in connection with cryptocurrency, provided that such advertising sponsorship rights are limited to promoting the company's corporate brands.”
The rise of cryptocurrencies in sports can be attributed to the expansion of crypto companies and their desire to expand into mainstream industries. The expansion of the crypto industry into the sports industry took off during the covid-19 pandemic, brought about by a drastically reduced income stream for a sporting industry that was forced to close many of their revenue channels. Sports sponsorship deals provide crypto companies with marketing opportunities and increased visibility and adoption.
In turn, sponsorship deals with crypto and blockchain companies have created innovative ways to earn revenue, for both the teams and individual players. In 2020, eToro partnered with several Premier League teams to promote its crypto trading service, and quickly rose to become one of Europe’s biggest football sponsors.
Similarly, sports teams and leagues such as Formula 1 have partnered with crypto companies such as Crypto.com, Socios.com, and Chilliz. With many teams choosing to collaborate in the creation of their own fan tokens.
The position held by the NFL is not surprising, considering their historic stance on once ‘taboo’ industries such as gambling and alcohol. As the continued adoption of the cryptocurrency industry by the sports industries seems to have no end date, it is likely that the NFL will alter their position, suggested by its recent hiring of someone to develop a strategy for the sector as part of a league-wide digital strategy.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.