Sports NFT Market Doubles to $2.6B in 2022

Credit: Ashoka Creation

Sports NFTs have had a banner couple of years since NBA Top Shot debuted in 2021, and according to one analysis company, the next decade could be even bigger. Market Decipher, a market research and consultancy firm, predicts that the sports non-fungible token market will have a compound annual growth rate of 36.3 percent over the next decade to reach a market cap of $42 billion by 2032. Here are all the details about the report.

  • Market Decipher analyzed growth trends for various sports NFT verticals
  • The two verticals leading growth are the digitization of cards and LE video clips
  • The sports NFT market achieved 100 percent growth from 2021 to 2022, reaching $2.6B
  • Revolutionizing the industry are NBA Top Shot and the NFL’s blockchain business

According to Market Decipher, the four most promising growth routes for the sports NFT industry are cards, accessories, collectibles, and video clips. Each has the potential for creating huge profits within the sector. Part of the profit margin comes from low manufacturing costs. Because the amount of money needed to tokenize an asset is comparatively little, sports leagues and companies can make “huge” amounts of revenue with digital marketplaces.

Chandradeep Singh, analyst at Market Decipher, said there are multiple tailwinds affecting the sports industry’s adoption of NFT technology. NFTs allow fans to own their favorite sports moments, trading cards are moving from physical to digital, and NFTs create a further income stream for leagues, athletes, and teams. Some blockchain companies are even paving the way for individual athletes and teams to set up their own marketplaces, outside of league markets.

Market Decipher states that the United States contains most of the current demand for sports NFTs. But emerging markets are not far behind, with Latin America being a particularly big market for soccer NFTs.

The Sports Industry Bets Big on Web3

While many industries have dived into Web3, few have done so with as much gusto as the sports industry. Not a month goes by without another story about the intersection between sports and the next iteration of the internet. Here are three we’ve covered.

Earlier this week, the NBA announced that it had partnered with Sorare to create an NFT-style basketball fantasy game. The game will launch around the start of the 2022-2023 NBA season, with hopes that it will complement NBA Top Shot.

Two months ago, the NHL shared that it will launch an NFT marketplace. Sweet, a digital collectibles trading platform, will host the hockey collectibles, which will feature “dynamic NFTs,” a “Trophy Room,” and “gamified collecting experience.”

Five months ago, Major League Baseball revealed it would drop NFTs for the upcoming season. Candy Digital, an Ethereum-based NFT platform, will host the digital collectibles. Each NFT will contain a video clip to create a more “immersive experience.”

Market Decipher’s bold prediction about the market cap of sports NFTs a decade from now is certainly not wrong about one part: sports NFTs are growing in number. And as more and more sports leagues are experimenting with the technology, it seems the switch from physical sports collectibles to digital may be inevitable.