Esports (short for electronic sports) is a competition using video games. Individuals or teams can join in, and it is a growing industry. Sebastian Quinn, CEO of YEsports makes the case for NFTs in Esports.
The convergence of gaming, non-fungible tokens (NFTs), and the metaverse stand to breathe a new, sustainable, utility-focused life into the burgeoning Esports sector. From bolstering the ongoing revenues streams of Esports organizations to galvanizing fan participation and engagement, NFTs hold several unique value propositions, almost perfectly suited for the Esports market.
This opportunity within virtual worlds is quickly materializing.
Microsoft’s recent acquisition of Activision Blizzard has shown that while it’s still early days, Esports’ shift to the metaverse is now becoming a reality.
The $69 billion acquisition aims to provide the ‘building blocks for the metaverse.’ It also looks to solidify Microsoft’s position in the Esports sector by allowing it to focus on communities and content – two essential pillars for success in both Esports and metaverse.
Fold in vocal support for useful NFTs from game publishers such as Epic Games, EA, and Ubisoft, and it’s not hard to see which direction the trend is heading.
Esports and why NFTs are important
NFTs, as their name suggests, are one-of-a-kind tokens that leverage decentralized and immutable ledgers to impart verifiable digital ownership.
The use cases of NFTs are vast. They can be attached to physical goods, enabling the authentication of commodities; affixed to digital items to create provably scarce digital artworks; or even leveraged to confer tangible ownership over in-game items.
For Esports fans, in particular, harnessing NFTs can unlock multiple opportunities. In fact, NFTs can literally be used to unlock access to VIP spaces, clubs, and channels hosted by Esports teams. This would allow fans to get closer to their chosen teams and gain a sense of camaraderie through which Esports communities thrive. It becomes the digital tool for ongoing fandom, membership, rewards, and access.
NFTs as a revenue stream
For Esports teams, NFTs, when done well, offer a long term, predictable revenue stream that helps bring much needed stability to the finances of organizations. For example, NFTs can be used to tokenize Esports merchandise as NFTs where holders get access to new drops of merchandise each year, no matter where they live. Thus expanding the global reach of Esports teams, and creating additional revenue streams that matter long term.
Even gaming clips of memorable and iconic esporting moments can be captured and transformed into an NFT.
Attaching real-world value to in-game assets, achievements, and awards serve as another obvious – albeit extremely important – example. A 2021 survey conducted on over 2000 gamers revealed that 63% of gamers want virtual goods with real-world value that can be traded and sold. And 64% said this functionality would lead them to play more.
The Esports market already boasts one of the highest levels of engagement, with the global live-streaming audience expanding at a CAGR of 15.7% from 2017 to 2022. The global games live-streaming audience is expected to hit 728.8 million this year, more than 10% higher than 2020 and 920.3 million by 2024. Throw the ability to enable true ownership over Esports assets into the mix, and user engagement stands to grow tremendously.
How does this tie in with the metaverse?
The overarching vision of the metaverse is a persistent and interoperable digital environment where users can interact with each other and transact with virtual stores and peers. This vision of the metaverse ties in almost precisely with the current Esports ethos, which has engendered tight-knit micro-communities on popular social platforms like Twitch and Discord.
Gen-Z’s desire for such campfire communities gives rise to platforms that encourage peer-to-peer interaction. These virtual communities are often centered around Esports and allow users to escape mainstream spaces.
Aiming to build upon this relationship, metaverse-based engagement platforms are already popping up that are designed to enable millions of Esport fans worldwide to engage fully with their favorite teams through custom-built metaverse experiences. YEsports, a Web 3.0 Esports engagement platform and NFT marketplace, is one such venue that creates a new forum for these Esports teams to interact with fans and release unique generative NFT packs or one-of-a-kind NFT collectibles, plus all-important access to Esports metaverse for fans to interact with their favourite teams and other fans.
The NFTs will act as keys for holders to obtain special perks, including access to the metaverse and activities within, as well as numerous IRL community incentives like VIP access to private Discord servers, signed merchandise, and exclusive video content.
For example, holding a particular rare NFT could allow the owner to enter private virtual spaces or get priority access to other limited edition NFTs and even real-world experiences such as meet and greets with celebrities and spokespeople.
All in all, NFTs, the metaverse and metaverse-based venues like YEsports, have the potential to level up the Esports sector from its relative niche to a globally recognized and widely embraced form of entertainment that will shape the future of digital and fan engagement across the world.