Premier League and Sorare: A Thriving NFT Fantasy Soccer Partnership Amid Crypto Market Volatility.
The Premier League has inked a multi-year agreement with Sorare, the $4.3 billion fantasy soccer game. The agreement grants the blockchain NFT game access to official player cards from the world's leading soccer league. Under the exclusive multi-year deal, players of Sorare can purchase and use official NFTs licensed by the Premier League. This is official now and will open the Web3 niche to hundreds and thousands of new potential gamers.
Paris-based Sorare, a startup with 3 million global users, enables people to play fantasy five-a-side soccer games. The game lets players win where success is determined by real-time player performance on the field. Sorare announced the launch of two new features in the game. Namely, the option to play with league-specific player cards and a "financial fair play" feature to prevent users from assembling all-star teams.
Sorare NFT Blockchain Game in Talks with Premier League
Rumors of Sorare's talks with the Premier League for a licensing agreement emerged in Oct 2022. Sorare CEO Nicolas Julia said the deal took longer to finalize due to the Premier League's existing NFT licensing contract with another company.
Sky News reported the deal was worth £30 million, but Sorare CEO Nicolas Julia declined to reveal the financial details or length of the agreement. This news comes despite a recent decline in NFT trading activity.
The Partnership between Premier League and Sorare Happens Amidst Crypto Winter
The value of NFTs (non-fungible tokens) has declined during the "crypto winter," a downturn in cryptocurrency prices. This which has been exacerbated in recent months by the bankruptcy of major exchange FTX.
CryptoSlam data shows that the average selling price of an NFT in December 2022 was $143.22, a 63% drop from $383.73 in December 2021. Trading volumes have also significantly decreased, with overall NFT sales plummeting 78% in December to $678.2 million from $3.1 billion the previous year.
According to CEO Nicolas Julia, Sorare has experienced a distinct trend compared to the rest of the NFT market. Exchanges of cards on the platform totaled $500 million last year, nearly doubling from $270 million in 2021. However, the company has observed a change in player behavior, with more players opting for the "free-to-play" mode, instead of using paid cards. Julia stated that 87% of Sorare players do not spend money on the platform.
Sorare's Run During Crypto Decline
This raises the question of Sorare's business model sustainability, as most users don't engage in transactions. Julia stated that the high spending power of a few users is sufficient to support the company's revenue generation. Sorare takes a cut of all transactions through its platform, the amount of which is not disclosed.
As per CryptoSlam data, Sorare is the third-largest NFT collection globally. CryptoSlam reported that the company processes about $1 million in transactions per 24 hours.
Esports Embraces Cryptocurrency
The Premier League's partnership with Sorare is part of a growing trend of sports leagues forming alliances with cryptocurrency platforms. Sorare has previously announced partnerships with Major League Baseball and the National Basketball Association.
Some partnerships, such as Crypto.com's naming rights for the Staples Center in LA and FTX's now-ended sponsorship of Miami-Dade Arena, fell through due to the decline in cryptocurrency prices.
According to Julia, Sorare is protected from the impact of the crypto crash on sports advertising as the company concentrates on licensing intellectual property rather than sponsorships.
Sorare, valued at $4.3 billion in Sept. 2021 by investors, is supported by major names. Some of the names are SoftBank from Japan, Accel, and Benchmark venture capital firms. Some sports legends like Lionel Messi, Serena Williams, and Kylian Mbappe are shareholders in Sorare.
Sorare Faces Regulatory Challenges
However, Sorare has faced criticism over allegations of promoting gambling.
The U.K. Gambling Commission is examining Sorare to determine if it needs a license or if its services aren't gambling, per an Oct. 8, 2021 notice. Julia stated he doesn't have an update yet on the U.K. inquiry's progress.
So, Sorare agreed to changes on its platform in November after action by the French National Gambling Authority. The amends included enhancing its free-to-play aspect. The firm must implement these changes by March 31st.
More About Sorare
In Sorare, players collect and trade football cards that are tied to real players and teams. Sorare is a crypto-based fantasy football game that has surged in popularity because of its ability to be both realistically entertaining and profitable.