Bruno Pessoa can’t help but smile when asked what it was like to explain the concept of NFT to agents and parents of football players.
“With family members it was more work, but in the end everyone understood. With entrepreneurs it was easier because they were already familiar”, says the founder and CEO of Tero Labs.
It is estimated that, this year, this market will move US$ 2 billion (R$ 10.4 billion).
NFT is the acronym for the non-fungible “token”, a type of “token” (a good that is not physical, only virtual) that represents something unique. It is not a cryptocurrency because it is not interchangeable.
Pessoa and Tero Labs came up with the idea of launching the “Rough Diamonds”, limited edition NFTs referring to the first year of the professional career of 11 Brazilian football revelations. The idea is that they will be able to be part of the Brazilian team in the 2030 World Cup.
All those chosen signed a contract with the company and will receive 50% royalties from what is collected.
“According to the evolution of their careers, the NFT can appreciate and be traded in the secondary market. I see it as something very similar to the American sports card market”, adds Pessoa.
In this case, NFTs are virtual images of players that represent their first year as a pro and are sold with authenticity codes to prevent fakes.
Among the names selected and who signed with the company, the one that draws the most attention is that of Endrick, 16, a striker who is Palmeiras’ biggest bet. This year he signed his first professional contract.
“It’s something new, different from anything I’ve ever seen. I’m looking to learn more and more about it. It’s always good to be remembered, recognized, and it’s no different in this case, even more so because it’s a choice to accompany me throughout my career,” says Endrick.
NFTs are on pre-sale right now.
In addition to Endrick, the project includes Weslley Patati, 18, Santos striker; Luiz Gustavo Bahia, 18, Corinthians midfielder; Luis Guilherme, 16, midfielder for Palmeiras; Ythallo Ryckelm, 18, defender for São Paulo; Matheus Lima, 16, Santos midfielder; João Cruz, 16 midfielder for Athletico; Bernardo Valim, 16, midfielder for Botafogo; Felipe Lima, 16, Flamengo forward; Matheus França, 18, Flamengo’s attacking midfielder; and Matheus Gonçalves, 16, forward for Flamengo.
The example of Neymar helped the company sell the idea to customers. In January of this year, the captain of the Brazilian team bought three virtual arts from one of the most valued collections in the world, the Bored Ape Yacht Club. It paid R$ 6.5 million.
Neymar doesn’t have an NFT of him or a virtual image that represents him. His case was just used to show how commonplace investing in this market is becoming. According to experts, care is needed. NFT can be valued by external factors such as popularity, scarcity and demand, but as supply increases, it is also possible for prices to fall in the future.
“The value of NFT [do Rough Diamonds] it will depend on the engagement, the rewards offered by the athletes, whether shirts used in games, meetings with buyers…”, explains the CEO.
The comparison of the American sports card market happens due to the limited availability and the valuation of the product according to the difficulty in obtaining them. Like NBA Michael Jordan season one cards, for example. Or those of baseball legend Babe Ruth.
According to research by ResearchAndMarkets.com, the American card market was valued at US$ 4.7 billion in 2019 (R$ 24.3 billion) and could reach US$ 62 billion in 2027 (R$ 321.1 billion ).
The simplest comparison for Brazilians is the sticker album. But in this case, the athletes’ image production is unlimited, according to demand. As for cards and NFTs, no.
“I think that stickers and albums aren’t as popular as they used to be, just as books and records gave way to digital books and streaming. We can’t hide from the future”, completes Endrick.
It is a market that can be constantly fed with new editions. Like NFTs from other seasons, from a specific tournament. But the beauty of the business is precisely that it is something limited in number.
Tero Labs already plans to replicate the formula with 11 young Argentine players and make an edition for African revelations.
“We want to do it in all countries that have talented players, in fact”, explains Pessoa.
NFT prices are not yet determined.
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