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The NFL Players Union has reportedly missed out on tens of millions in sponsorship and licensing revenue tied to the burgeoning crypto industry during the 2022 fiscal year, according to The Athletic.
According to The Athletic, OneTeam Partners owes the NFL Players Union a substantial $41.8 million. This shortfall applies to income generated through the use of the players’ brands in licensing and sponsorship agreements.
OneTeam Partners, established in 2019, has been crucial in securing these agreements. It also manages merchandise trading and player card creation. However, a cloud of uncertainty now hangs over the firm’s ability to deliver on its financial obligations.
Inside sources have revealed that this lack of revenue is intrinsically linked to the NFTs launched in partnership with the NFL.
The NFTs were part of a deal with Dapper Labs, the firm also responsible for running NFTs for the NBA.
The rise of NFTs in 2021 led to revenue sharing deals in the sports industry, some exceeding $10 million. The collapse of the crypto market resulted in a sharp decline in NFT values. This decline had a knock-on effect on associated income. Dapper Labs, which relies heavily on NFTs, has been hit hard. This resulted in large redundancies and a significant decrease in income.
Dapper Labs entered into negotiations with the NFL in April 2023 to revise the terms of their existing agreement. This renegotiation process has the potential for a significant reduction, possibly over 50%, in the previously agreed revenue sharing guarantees.
As a result, the NFL Players Union now faces significant challenges, as it is unable to secure an expected $41.8 million in NFT-related revenue.