The rising popularity of cryptocurrencies is having a remarkable impact on the sports industry, just like in any other sector. Especially nowadays, athletes, sports clubs and even sports organizations have started to prefer cryptocurrencies in their sponsorship deals or payments.
Gibraltar United, a Gibraltar Premier League team, is the first club in the world to pay the wages of its players with cryptocurrency and to include this as a club policy in player contracts. Sacramento King, an NBA team, has been accepting cryptocurrency as a payment method for tickets and merchandise since 2014, an India-based cryptocurrency exchange has given cryptocurrency as a reward to athletes who made a degree in the Olympics, Lionel Messi made history as the first football player in the world to be paid with Fan Token, and many more examples can be listed. The number of similar examples in the sports industry is increasing at an accelerated pace today. You may have heard that in our country, in 2018, a football player from the amateur cluster teams was transferred for virtual money for the first time. .
In the sports industry, blockchain-based fan tokens and coins and tokens issued on behalf of football players are also produced, which have recently become the center of attention among clubs in order to increase their revenues. We think that we can easily comment that the fact that cryptocurrencies are involved in the sports industry in this way brings a different, unique perspective and high interaction to the sports industry. Juventus is the sports club that launched the world’s first Fan Token Offering (FTO). This is just the beginning and examples are frequently seen in our country and around the world. Galatasaray Fan Token, Manchester CITY Fan Token, Fenerbahçe Fan Token…etc
The reason why cryptocurrencies are so prominent and preferred is that cryptocurrencies have many advantages such as the fact that instant payments can be made with very low transaction costs. Having these advantages is a factor in the increasing popularity of cryptocurrencies in the sports world. Those who have a prejudiced and critical perspective towards cryptocurrencies; in this context, the first argument they present in this context is that it may carry the risk of being much more open to money laundering and illegal activities than usual payment methods. As it is known, the sports industry has a prejudiced and critical approach towards cryptocurrencies due to the high level of black money available due to illegal betting. In fact, on the contrary, cryptocurrencies have the power to bring transparency to the sports industry with the benefit of blockchain technology. We can even say that; connecting all sports transfers in the world to a system running on blockchain technology and making it possible to control them can eliminate such risks.
The increasing effectiveness of cryptocurrencies brings along various problems and uncertainties in sports law in this context.
First of all, the legal status and regulations of cryptocurrencies play a decisive role in the context of sports law. In many countries, the legal status of cryptocurrencies has not yet been clarified, which creates uncertainty for sports organizations and other interested parties. In addition, issues such as taxation and international transfers of cryptocurrencies are also closely related to sports law.
Another important issue is how to handle cryptocurrency sponsorship agreements from a legal and contract law perspective. When entering into agreements with athletes or clubs involving cryptocurrencies, it is necessary to clarify the terms of the contract and identify potential risks. In addition, it is important to draft contracts taking into account factors such as sudden changes in the value of cryptocurrencies and market fluctuations. Since this field contains a lot of technical and legal information, getting both legal and technical support will be beneficial in preventing possible loss of rights in the future. It is even important to take the necessary cyber security measures in order not to face the threat of a cyber attack at any time during the transfer.
As mentioned above, the use of cryptocurrencies in the sports industry may give rise to new criminal and regulatory responsibilities in sports law due to their association with illegal activities such as betting. In this context, sports organizations and regulatory bodies should develop appropriate policies and measures to prevent the use of cryptocurrencies in illegal activities.
In conclusion, we believe that the use of cryptocurrencies in the sports industry will create more opportunities than problems in sports law. The development of regulatory frameworks in this area, as well as a legal basis, will make it easier for the sports industry to adapt to the changes brought by cryptocurrencies. As the number of examples of cryptocurrencies in the sports industry increases day by day, this will become commonplace. There is no doubt that the contribution of blockchain technology to the sports industry will be inevitable.