Crypto Partnerships Fuel the NBA’s Sponsorship Revenue This Year

The 2021-2022 season was NBA’s 75th. The inaugural 1949–50 season was won by Minneapolis Lakers with Syracuse Nationals taking up second place. NBA, as we know it today, has transformed in more ways than one. It has a huge legion of fans and massive sponsorship deals, significantly boosting NBA’s revenue numbers.

Looking at the 2021-22 season which stretched from 19 Oct 2021 to 18 Jun 2022, the NBA raked in US$1.64 billion in sponsorship fees. This represented a 12.5% year-on-year rise. Cryptocurrency as a sponsorship category contributed a staggering US$130 million up from US$2m the previous season.

If you’ve been keen, you may have noticed names of a trading platform or fan engagement application printed on team jerseys and other merchandise. Sponsorships made by trading platforms come in various ways from arena-naming rights to global rights agreements and anything in-between.

What Are the Crypto Brands in Sponsorship Deals?

A good number of the 82 matches of the 2021-2022 season, saw crypto logos including Coinbase, FTX and featuring prominently. It is also worth noting that the cryptocurrency sponsorship category came second as the league’s biggest sponsor after technology. Here are some of the top NBA deals so far in the crypto space.

Golden State Warriors multiyear agreement

Western Conference, Pacific Division’s Golden State Warriors signed a multi-year global sponsorship deal with FTX worth an estimated $10 million. Following the deal, FTX will become Golden State Warriors’ official cryptocurrency platform as well as a marketplace for NFTs.

The deal includes branding of Santa Cruz Warriors’ press table and pole pads. Santa Cruz Warriors is an NBA affiliate of Golden State Warriors and plays in the G League. Miami Heat Arena’s naming rights were also secured by FTX for US$135 million. This is in addition to a 10-year agreement worth $17.5 million that FTX has with Cal Athletics for naming California Memorial Stadium.

LA’s Iconic Staples Center naming deal

“The House That Kobe Built,” or the Staples Center arena, was named Arena in December 2021. The 20-year naming rights bought from AEG constituted one of the biggest naming rights deals in the history of sports-US$700 million.

As part of the agreement, Los Angeles Lakers will have as their official partner.

Philadelphia 76ers Jersey Patch Partner Deal

In September 2021, the Philadelphia 76ers announced a deal to have as their jersey patch partner. The agreement also provided for the development of 76ers first-ever NFT which is to be sold through the platform.

NBA’s Multiyear deal with Coinbase

In a first of its kind, the NBA together with the NBA G League, USA Basketball, Women’s National Basketball Association (WNBA), and NBA 2K League signed a deal to have Coinbase as the cryptocurrency partner.

As a result of this deal, the Coinbase brand will continue featuring during NBA broadcasts. NBA fans will have new ways to engage with the cryptocurrency platform both within and outside the NBA ecosystem.

The Future of Crypto Sponsorships

As the cryptocurrency space seeks exposure and acceptability, more of these deals will join the pipeline. As NBA fans and retail investors get to familiarize themselves with how cryptocurrencies work and the opportunities they present, there is likely to be an uptick in crypto trading activities on the various platforms.

Having said that, investors must also understand that crypto is relatively more volatile than other asset classes. This means that investors must tread cautiously to avoid being caught in downtrends that can erode their gains.

Despite central banks ratcheting up interest rates to cool off their respective economies and the likelihood of a recession down the road, crypto sponsorships will still be significant. As seen in the analysis above, many of these contracts span multiple years and it is unlikely they will be rescinded midway.

Outlook and Conclusion

Cryptocurrency sponsorship deals have taken centre stage as the industry builds credibility, exposure, and acceptance. With the millions of dollars pouring into NBA from crypto trading platforms and fan engagement applications, the sponsorship gap between the technology and crypto categories may narrow fast. Eyes are set on the 2022-2023 season that begins in October 2022 and runs to April 2023.

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