Non-fungible tokens became one of the most popular vehicles for college athletes to make money in the first year of the name, image, and likeness era.
As reported by Front Office Sports, the University of Iowa’s Luka Garza and Gonzaga’s Jalen Suggs minted some of the earliest NFTs in the college sports world shortly after finishing their final seasons in the NCAA, and many active college athletes across the country have followed suit.
Companies likewise flocked to the industry. Some existing sports memorabilia brands created NFT products, while many new companies popped up specifically to occupy the space. Brands poured more cash into NFTs and trading cards than any other segment of NIL activity, comprising more than 17 percent of the NIL market, according to Opendorse data cited by MarketWatch.
If there is a prototypical NFT, according to Front Office Sports, it would be a virtual trading card — either highlighting an athlete or a key moment in their career. Companies such as Topps, Signing Day and Candy Digital used that model, but many other approaches have been taken since.
Front Office Sports spoke to three companies with as many different focuses.
- The Players’ Lounge, started by two former Georgia football players, has created school-specific groups of NFTs — though most of their value lies in the associated in-person events.
- Legacy League focuses on offering NFTs to women’s sports and Olympic athletes — often in collections relating to athletes’ interests — and also handles graphic design, so athletes don’t have to create NFTs themselves.
- Katana Capital — a fund that isn’t specifically for college athletes — sees them as celebrities, artists, and influencers equal to its other clients. It focuses on NFTs, DAOs, and the Metaverse.
Compensation range varies broadly but appears to be lucrative given how little time athletes have to put in.
- Stuart Bush, CEO and co-founder of the Legacy League, said athletes can make anywhere from $300-500 to $10,000-20,000. On his platform, athletes receive 75% of the total NFT sale.
- Co-founder and CEO of The Players’ Lounge, Keith Marshall, a former NFL player, also noted that when NFTs are sold on the blockchain, athletes can receive profits for secondary market sales, which isn’t possible with traditional paper trading cards or autographs.
Despite all the benefits of NFTs, the recent crash in cryptocurrencies is a major concern, according to Front Office Sports. Will NFTs be worth anything in the future? Will the money athletes receive through cryptocurrencies be severely devalued?
Both Legacy League and The Players’ Lounge believe their business models are stable despite volatility in the crypto market.
Bush said many Legacy League NFTs are paid for with credit cards and regular money, while Marshall maintained that even though crypto is the transactional currency for the company’s products, the intrinsic value of in-person experiences will remain intact.
Katana founding partner Kuntal Shah told Front Office Sports he is optimistic that the market will rebound. “There’s a lot of stuff in the news that says, ‘NFTs are dead,’” he said. “NFTs are really only 2 years old.”
As far as the opportunities go? “This is probably not even the first inning,” Shah said. “It’s like, the pitchers are still in the bullpen, getting ready for the first pitch.”