The National Football League (NFL) will allow its teams to strike sponsorship deals with cryptocurrency companies, although under strict limits that suggest the league isn’t entirely sure this won’t eventually come back to bite it on the ass.
CNBC recently revealed that the NFL had reversed its policy on prohibiting teams from entering into marketing partnerships with digital currency firms. The league prohibited such tie-ups last September, limiting teams to deals with companies with no direct ‘crypto’ ties, such as asset managers that sold digital currency-affiliated funds.
However, following a league ‘evaluation,’ the NFL has decided to permit “promotional relationships without undertaking excessive regulatory or brand risk.” The NFL cautions that it is “essential” to “proceed carefully” before entering into any ‘crypto’ deals, with an emphasis on conducting “appropriate diligence on all potential partners and their business models.”
While teams will now be able to deal directly with crypto exchanges—assuming their ‘business models’ don’t send up too many red flags—all deals will be subject to league scrutiny before anything can go ahead. There are also clear out-of-bounds markers: teams still can’t promote a specific digital currency or issue bespoke ‘fan tokens’ that can be redeemed for merchandise or other team-related perks.
Official logos won’t be permitted in digital currency ads, with a carve-out for ads produced “in connection with League-level NFT partnerships.” (The NFL has NFT deals with Dapper Labs and Panini for videos and trading cards, respectively.)
NFL teams also can’t feature digital currency signage in their stadiums and all deals will have a maximum three-year duration. That 36-month cap will prevent the type of decades-long venue naming rights deals that teams in other North American leagues have struck with digital currency exchanges.
The cap suggests that the NFL suspects that the blockchain space could expand rapidly and the league doesn’t want to lock itself into deals that prevent it from gouging even more money later. That, or the league doesn’t want its teams saddled long-term to any company that careens from one scandal to the next and drags the NFL down with it.
Gradually, then suddenly
Always the most cautious of the North American pro leagues, the NFL took a similarly tentative approach to associating its brand(s) with gambling companies. In 2015, the betting-phobic NFL went so far as to ban its players from participating in a fantasy sports convention, ostensibly because it was being held in a Las Vegas casino. But that same year, the league allowed teams to sign sponsorships with daily fantasy sports (DFS) firms, then struck a league-level deal with DFS giant DraftKings.
The climate had improved dramatically by 2019, when Caesars Entertainment became the NFL’s first official casino sponsor. In 2020, the league allowed teams to strike sponsorships with U.S.-licensed sports betting companies. In 2021, the league itself signed up three official betting partners, officially closing the door on the NFL’s specious argument that betting represented an existential threat to the integrity of its games.
Over the years, this evolution sparked a notorious deluge of DFS ads during NFL game broadcasts, while a similar ad blitz by U.S.-based sportsbooks followed the 2018 U.S. Supreme Court ruling that legalized single-game sports betting. In each case, the gambling companies were looking to build market share in an embryonic but rapidly expanding industry. It was basically the Oklahoma Land Rush minus the horses but somehow drowning in horseshit.
You have to do better because you couldn’t do much worse
Even more dramatic marketing efforts are now being conducted by major crypto exchanges like FTX, Coinbase and Crypto.com, helping fuel American consumers’ growing interest in digital assets. Nine-figure sports tie-ups are becoming the norm and teams/leagues are salivating at the possibility of a major new revenue stream from an industry that barely existed five years ago.
But while these digital currency firms seem to have no limits when it comes to their marketing budgets, the same can’t be said for their investment in less glamorous areas like infrastructure or customer service. These companies appear willing to do whatever it takes to acquire a customer then do as little as possible once they’ve convinced that customer to make a deposit.
Crypto Twitter is perpetually awash with customers venting over exchanges that suspiciously crash whenever there’s a sharp drop in token value, effectively forcing them to HODL against their will and/or see their futures positions liquidated. Customers also lament being unable to connect with a human support person during the all too brief window of opportunity in which they realize their exchange account has been compromised but before it’s been drained of all value.
Exchange CEOs subsequently issue half-hearted mea culpas in which they blame teething pains due to the extraordinary growth they’ve undergone in recent years. In this fashion, every crisis can be turned into yet another marketing opportunity.
These hiccups are often accompanied by hoary pledges to ‘do better’ in the future, channeling the go-to phrase that Meta/Facebook founder Mark Zuckerberg used every time his company was caught doing shady crap in pursuit of growth at all costs.
Don’t be Mark
Facebook’s travails are a worthy metaphor for the digital currency exchanges’ current M.O., particularly when it comes to Zuckerberg’s unwillingness to spend what it takes to ensure proper content moderation. Despite routinely earning double-digit billions in annual profits, the so-called Facebook Papers revealed that the platform relies on a woefully inadequate number of humans to detect and delete offensive content, and its AI filters are nowhere near up to bridging that gap.
Like Zuckerboy, many digital currency firms seem to believe they’re doing the Lord’s work by bringing crypto power to the unempowered masses and anyone who questions their motives or methods either doesn’t understand or is sowing FUD (fear, uncertainty and doubt). That missionary zeal justifies growth at any cost—but those costs are increasingly being paid by the consumer, not the companies.
For years now, major digital currency firms have been booking outlandish profits without any corresponding investment in ensuring a better customer experience. NFL fans are now going to be inundated with a barrage of FOMO-filled ‘crypto’ come-ons that hint at the pot of gold awaiting them at the far end of this rainbow. That is, if they can make it across these rickety structures without falling—or being pushed—off.
Watch: CoinGeek New York panel, The Future of Digital Asset Trading
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