After the mega $210 million sponsorship of FTX Crypto Exchange for TSM esports in 2021, a flurry of sponsorship agreements broke out. Major teams, competitions, and leagues teamed up with cryptocurrency companies like Coinbase, FTX, and Uniswap. Along with expanding NFT and Web3 initiatives from teams and leagues and the growth of tournaments centered around NFT-powered games, that trend persisted into 2022.
A clear overlap
Both esports and cryptocurrency overlap in terms of participants. Both are primarily male-dominated industries populated by young, tech-savvy adults who grew up alongside the video game industry. They value digital items and have seen esports and cryptocurrency grow from niche interests to major industries.
Interestingly, there have been a few high-profile examples of esports industry leaders transitioning into prominent positions in the cryptocurrency space. Ryan Wyatt, the current CEO of Polygon Studios, previously worked for Major League Gaming (MLG) before becoming the head of YouTube Gaming, which broadcasts esports tournaments. Meanwhile, Benoit Pagotto served as team Fnatic’s brand and marketing director before co-founding RTFKT Studios, the NFT startup that Nike later acquired.
Online gaming is the next big thing
In 2022, video games had sales of $200 billion globally. Esports tournaments, with skilled pro gamers battling it out for huge rewards, shot to $2 billion in revenue. According to Twitch, an esports broadcaster, even watching games has become a booming business as it clocked in 770 billion minutes watched in 2022 alone with five months left in the year.
Image courtesy: Statista
- 83% of video game sales take place in the digital world. (Global X ETFs)
- In 2021, US consumers spent $60.4 billion in the video gaming sector. (Newzoo)
- There were approximately 14.1 billion mobile game downloads in Q1 of 2021. (Statista)
- People between 18 and 34 make up 38% of gamers globally. (Statista)
- online game revenue is estimated to hit $26.29 billion in 2022. (Statista)
This field is set for the rapid growth of 6.46% between 2022 – 2026. Statistics show that this will result in a market worth of over $33.77 billion by 2026. China will be the leader with the most revenue generation (over $6,053 million in 2022).
How crypto can help esports
While regular payments require authorisation from the government or banks, crypto payments do not. Thus, allowing gaming organizations and players to compete internationally without having to go through those loopholes while also having a secure way to finalize their transactions. They do not need to reveal their identity, and they can withdraw their funds from anywhere in the world using cryptocurrencies.
Another significant esports crypto development in recent times is making esports betting easier and safer. Betting on esports with crypto can be a simple way to make money, especially if you do some bitcoin esports betting where the stakes are high.
Sponsorships for esports by crypto companies
London-based esports franchise Fnatic has signed a five-year sponsorship with Crypto.com worth $15 million. The deal will see Fnatic create exclusive NFTs for their fans, while Crypto.com’s logo will appear on jerseys for Fnatic’s esports teams. Fnatic is Crypto.com’s first esports partnership and ushers the crypto giant into the world of esports.
According to reports, cryptocurrency exchange company FTX is sponsoring the Brazilian esports organisation FURIA. According to Esports Insider, FURIA confirmed that FTX would pay around $3.2 million for the one-year contract, which is only the first step toward establishing a “long-term relationship” with the sponsor.
MIBR (Made in Brazil), a Brazilian esports organisation, has partnered with cryptocurrency exchange Bybit. As a result, the exchange will support MIBR’s female and male rosters in CS:GO, Rainbow Six, VALORANT, and Free Fire.
Also, UK-based gaming and lifestyle brand Quadrant has partnered with cryptocurrency exchange platform Gate.io for its Quadrant Halo division. Following the partnership, the Gate.io logo will feature on the team’s jerseys during the HCS Major Kansas City 2022. Quadrant will also benefit from Gate.io’s products and support, according to the release.
Crypto firms want the esports audience, while esports startups need money. It’s long been known that esports teams are losing money in the short term in the hopes of being rewarded as the industry grows and attracts more attention. With a similar audience and a vast market to explore, crypto and esports seem like a match made in heaven.