Issue No. 6: MLB's debut, tech & sales struggles, an influencer succeeds
Here's your weekly review on what happened at the intersection of NFTs and Sports:
- ⚾ MLB sells out NFT series, but faces tech issues
- 😰 Athlete-driven NFTs keep struggling, can Pelé score?
- 🥊 Jake Paul generates over $300k in sales
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⚾ MLB sells out NFT series, but faces tech issues
Our prediction in last week's issue was that the launch of the first-ever MLB NFT series with Topps would be a success and that the WAX platform (where they are running it on) would be stable. As it turned out only part of this prediction was correct. Let's look at it step by step.
What went well
- Topps MLB launched on April 20 and all available packs (standard and premium) were sold out within the first two hours. Let's do the maths: 50k Standard Packs x $5 + 24k Premium Packs x $100 = $2.65m in revenues (assuming the MLB didn't keep any of the packs)
- The next interesting fact is the one of secondary market sales, where the cards and packs were traded for a total of $1.39m on launch day. This made MLB Topps the second biggest NFT project on that day (behind CryptoPunks) and the leading one in sports.
- And we have witnessed a big sale already. The 1 of 11 Mike Trout 1986 Anniversary Chrome Facsimile Signature card sold for over $87k on April 22, according to WAX
Areas to observe
- The tech! While we assumed that WAX would learn from the issues that NBA Top Shot had faced multiple times it seems they were not prepared well enough for the stampede that was awaiting them. So what happened? First the launch was postponed by 30 mins to make sure everything works well. Then the over 1,200 request per second (!) overwhelmed them. The result: A range of error messages, problems with the checkout, credit card payments that not resulted in packs being delivered and many disappointed customers who expressed their anger on Discord and Twitter. We tried it as well, got charged and a few hours later the payment was reverted, even though we paid at a time when the official communication said that packs are still available. That is of course not contributing to a good experience, let's hope they get that solved asap.
- Secondary market sales on each of the two days after the launch dropped below $1m, ranging between $800k and $900k, according to Cryptoslam. That itself is not bad, as it's roughly 2-3 times the Sorare amount, but still clearly behind NBA Top Shot which hardly drops below $2m a day. Will be interesting to see how that develops as it is an important indicator for the fans' perception.
- More a personal opinion: We find the 8 (!) levels of scarcity for the cards a bit too much. We get that this makes the cards more accessible from a price perspective on the lower levels but decision-making on the marketplace becomes a bit confusing. Maybe 4-5 levels would have done it as well.
Long story short: Successful launch from a financial perspective, fans (and investors?) are jumping on it, let's see if the MLB can keep up the momentum and improve those tech issues.
😰 Athlete-driven NFTs keep struggling, can Pelé score?
Our second prediction of last week's issue was that we didn't expect many drops from athletes to happen, as the sentiment did not seem like a good one. Again we were partly right. There were more drops than expected, but sales have not been going so well. But we've seen some interesting angles. Here's the overview:
- NHL legend Bryan Trottier released an NFT collection that commemorates his extraordinary career, especially the Islanders historic “4 in a Row” Stanley Cup wins in 1980, 1981, 1982, and 1983 and Trottier’s 107 points in those 70 playoff games. They are selling on OpenSea AND Bitski, but so far only some pieces have been sold on BitSki while most struggle on OpenSea. What we like: The approach to sell on two platforms is interesting and the fact that the 1-of-1 NFT includes original audio recorded specifically for the NFT.
- NBA veteran Wilson Chandler (2007 1st round pick, 13 years in the league) signed a "virtual shoe deal" with NFT marketplace CryptoKickers, offering the "first ever signature shoe designed specifically for balling in the metaverse". His kicks are available on OpenSea. Some of them have been sold (around $50 per pair), but many are still up to grab. We really like the idea! Imagine one of the big names in sports running this... But here comes the best aspect: 50% of sales will benefit a nonprofit in Wilson's hometown which will donate physical shoes for youth in the community, and provide educational seminars on crypto, NFTs and Blockchain technology. Applause!
- NCAA star Jalen Suggs from the Gonzaga Bulldogs created a 1-of-1 NFT to declare for the 2021 NBA draft. It shows him celebrating what was the first buzzer-beater in the semi-finals since 1977. The highest bidder of this initial auction would also get the shoes he wore in the game, autographed by Jalen. The item was sold for 4.1265 ETH, which is around $10k. Not bad but not so great either...
None of those drops really stand out but contain some interesting angles (added audio, donating physical goods, declaring for the draft). We're monitoring a few others that we'll share in next week's issue in case something interesting comes up.
Our hope: Pelé announced an NFT launch for May 2 in cooperation with Ethernity. It's the platform where Tony Hawk and Muhammad Ali NFTs were announced before, it seems like they have a clear "legend-only" strategy! Truly made for eternity...
🥊 Jake Paul generates over $300k in sales
We already talked about Triller and Jake Paul in previous issues. And the influencer-gone-boxer has pulled it off! As announced he'd release an NFT collection called "The Future Of Boxing" when "Jake defeats Ben Askren in the ring April 17th". And so he did! The drop happened right after the K.O. and did really well!
The top three bidders combined for over $220.000, taking away the 1-of-1 champ card ($99k) and two gold cards, with the total amount being over $300k for all 69 cards. Once again we have witnessed the benefits of being an influencer and having a certain following.
🧭 What's the direction?
So what have we learned from the above? First thing that comes to mind: It makes us wondering in which direction NFTs are heading. While athletes seems to struggle with their drops (also Jake Paul can't just keep selling NFTs like this one) and the usual rights holders in sports probably all follow a similar concept (there are some good reasons for that) we're eagerly waiting for new initiatives with smart and sustainable models, not just one-off sales. Is it the Triller project that turns short video clips into NFTs? Is it Tom Brady's Autograph platform? Or someone who we did not have on our radar? Lots of projects are currently in the making and we expect (too) many marketplaces to pop up over the next months, but which approach will be the game changer? And what are the elements that makes it succeed?
Feel free to get in touch and let us know you opinion!
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