Esports, or competitive video gaming, is a booming industry that attracts millions of fans and players from around the world. According to Newzoo, a leading gaming market research firm, the global esports audience reached 495 million in 2020 and is expected to grow to 646 million by the end of 2023. Esports tournaments can offer huge prize pools, prestige, and fame for the winners, as well as entertainment and excitement for the viewers. In 2020, the total esports prize money amounted to $211 million, with the highest prize pool being $34.3 million for The International Dota 2 tournament. But how does cryptocurrency fit into this picture?
Cryptocurrency is a form of digital money that operates on a decentralized network of computers, using cryptography to secure transactions and verify ownership. Cryptocurrency has many advantages over traditional fiat money, such as lower fees, faster transactions, greater privacy, and more control over one’s funds. Cryptocurrency also has the potential to revolutionize the esports industry in various ways.
Cryptocurrency and Esports Payments
One of the main benefits of cryptocurrency for esports is that it can facilitate cross-border payments and eliminate intermediaries. Esports players and teams often face difficulties when receiving their winnings from international tournaments, due to high fees, delays, currency conversions, and regulatory hurdles. Cryptocurrency can solve these problems by allowing instant and direct transfers of value between parties, regardless of their location or jurisdiction.
For example, in 2018, the esports platform Unikrn launched its own cryptocurrency, Unikoin Gold (UKG), which allows users to bet on esports matches, earn rewards, and access exclusive content. Unikrn also partnered with BitPay, a cryptocurrency payment service provider, to enable players to receive their winnings in Bitcoin (BTC) or other cryptocurrencies. This way, players can avoid the hassle of dealing with banks, payment processors, or third-party platforms that may charge high fees or impose restrictions on their funds.
Another example is DreamTeam, an esports recruitment and management platform that uses its own cryptocurrency, DreamTeam Token (DTT), to facilitate payments between players, teams, sponsors, and advertisers. DreamTeam allows users to create smart contracts that automatically execute payments based on predefined conditions and milestones. This ensures transparency, security, and efficiency in the esports ecosystem.
Cryptocurrency and Esports Revenue
Another advantage of cryptocurrency for esports is that it can create new revenue streams and business models for the industry. For example, cryptocurrency can enable fan engagement and loyalty programs, such as tokenized rewards, voting rights, and access to exclusive content. Cryptocurrency can also enable crowdfunding and sponsorship opportunities, such as initial coin offerings (ICOs), fan tokens, and non-fungible tokens (NFTs). These can help esports organizations raise funds, expand their fan base, and create unique digital assets.
For example, in 2019, the esports team OG issued its own fan token, OG Coin (OGC), which allows fans to participate in polls, access behind-the-scenes content, and receive discounts on merchandise. OG also became the first esports team to launch its own NFT collection, featuring digital memorabilia from its historic victories at The International Dota 2 tournament. The NFTs were sold on OpenSea, a popular marketplace for digital collectibles, and generated over $400, 000 in revenue for the team.
Another example is Chiliz (CHZ), a blockchain platform that powers fan tokens for various sports and esports organizations. Chiliz allows fans to buy fan tokens using CHZ or other cryptocurrencies and use them to vote on team decisions, interact with players and staff, and access exclusive rewards and experiences. Some of the esports teams that have partnered with Chiliz include Team Heretics, Team Alliance, and NAVI.
Cryptocurrency and Esports Innovation
A third benefit of cryptocurrency for esports is that it can enhance the gaming experience and innovation. Cryptocurrency can enable new forms of gameplay and interaction, such as wagering, betting, tipping, and streaming. Cryptocurrency can also enable new genres and platforms of gaming, such as blockchain-based games,
decentralized applications (DApps), and metaverses. These can offer more variety, creativity, and immersion for gamers and spectators.
For example, in 2020, the blockchain game Axie Infinity introduced its own cryptocurrency, Axie Infinity Shards (AXS), which allows players to breed, battle, and trade digital creatures called Axies. Axie Infinity also features a play-to-earn model, where players can earn AXS by completing quests, winning battles, or selling Axies on the marketplace. Axie Infinity has become one of the most popular and profitable blockchain games, with over 2 million daily active users and over $2 billion in trading volume as of November 2021.
Another example is Theta Network (THETA), a blockchain platform that powers decentralized video streaming and delivery. Theta allows users to earn THETA or Theta Fuel (TFUEL) tokens by sharing their bandwidth and computing resources with other users, creating a peer-to-peer network that reduces the cost and improves the quality of video streaming. Theta also enables users to create and watch esports content, such as live tournaments,
highlights, and analysis. Some of the esports partners that use Theta include World Poker Tour, G FUEL, and Esports Fight Club.
Cryptocurrency and esports are two digital trends that have a lot in common. They both rely on technology, innovation, and community. They both appeal to a young, tech-savvy, and global audience. And they both have the potential to grow exponentially in the future. By combining their strengths and synergies, cryptocurrency and esports can create a powerful and mutually beneficial relationship that can transform the gaming industry and beyond.