Spain's top football league La Liga said on Thursday it will offer NFTs to all its players, marking the latest foray into cryptocurrencies by the major sports organisation.
NFTs, or non-exchangeable tokens, are unique digital assets that are designed to prove ownership of a virtual item, such as rare art or trading cards, in a blockchain . They cannot be exchanged with each other on an equal basis, unlike bitcoins and other cryptocurrencies.
As our Indonesian colleagues at General Exness Review have learned, La Liga is teaming up with French startup Sorare to launch its NFT. Sorare's platform allows users to swap digital player cards and manage teams of five in a number of fantasy football tournaments.
Sorare said it had signed a long-term exclusive licensing agreement with La Liga to add top players to its platform, including Atletico Madrid's Antoine Griezmann, Real Madrid's Vinicius Júnior and Barcelona's Pedri.
"Today is an important milestone for us because this is the first top five leagues to join the platform," Nicholas Giulia, CEO and co-founder of Sorare, told CNBC.
The company said La Liga clubs will receive royalties on sales and Sorare has paid a minimum guarantee to ensure exclusivity.
Sports industry explores cryptocurrency
La Liga is one of many sports associations entering the world of cryptocurrency. The National Basketball Association, for example, licenses game highlights for a collection platform called NBA Top Shot, developed by start-up Dapper Labs.
In the world of football, Manchester City has dropped two NFT collections. Meanwhile, a number of clubs have issued so-called fan tokens, which allow their holders to vote on mostly minor club decisions and receive certain perks.
Last month, it was revealed that part of Lionel Messi's welcome package to Paris Saint-Germain included a French club fan token, which was developed with the help of cryptocurrency firm Socios.com.
Sales of NFT have soared this year. A work by digital artist Beeple was sold in March for almost $70 million, while Visa recently bought a crypto-collectible called CryptoPunk for almost $150,000 in ether.
Proponents of NFT say it is a way of achieving verifiable scarcity and ownership of digital media that can be reproduced and distributed on a massive scale through free access to content online.
However, critics see the trend as a potential bubble in a market known for speculative investment. NFTs have also been the cause of a number of scams: a fake Banksy collectible was sold for more than $300,000 in an apparent hack of the artist's website.
Sorare claims that since the beginning of 2021, sales through its platform have amounted to more than $200 million. In total, there are more than 500,000 registered users on the platform.
Sorare hopes to sign each of the world's top 20 football leagues by the end of 2022.
Founded in 2018, the startup is reportedly preparing for a $530 million funding round, giving it a valuation of at least $3.8 billion . Sorare declined to comment on the report.