NFLPA Can’t Collect $41.8M After NFT Collapse
In its latest financial report, the NFL Player’s Association (NFLPA) announced that it is unable to collect $41.8 million, which represents approximately 25% of its annual commercial revenue.
A report from The Athletic reveals that the outstanding $41.8 million the NFLPA is unable to collect is likely linked to the collapse of a crypto market, specifically the collapse of the NFT market.
In the report, the NFLPA wrote “As of February 28, 2023, there is uncertainty surrounding the collection of certain receivables from OneTeam Partners, LLC. Therefore, an allowance has been recorded from this date for these amounts.” Daniel Kaplan by The Athletic adds “The NFLPA listed $41,799,008 for OneTeam next to accounts receivable, a category for funds owed to customers.”
The report goes on to discuss how OneTeam Partners has been very successful in recent years working with the NFLPA, MLB, US Women’s National Soccer Team, Major League Soccer Players Association, Women’s National Basketball Players Association and others, as well as entering the NIL place.
The report then goes on to discuss the losses…
In April, it was reported that Dapper Labs and DraftKings’ Reignmakers NFTs were attempting to renegotiate licensing agreements. And here’s the meat and potatoes of the report that the NFT’s collapse has cost the NFLPA $41.8 million:
“OneTeam would have expected about $60 million from Dapper & DraftKings, of which $41 million would go to the NFLPA,” the person who has been involved in past NFLPA trades wrote in a direct message. “Now, NFTs are relatively new, so most of the money usually comes from Madden and trading cards.” By that, this person means that bread-and-butter licensing businesses like video games and trading cards at the NFLPA remain healthy. Cryptocurrency is a relatively new category for the unions and has not been a dependent source of income. Still, this person described the $41.8 million in missed payments as “horrendous.”
For the context of how “down” the NFT market is, here are some statistics from a report by Blank in December:
In October 2022, NFT sales were down more than 90% in almost every metric – including volume and price – compared to the previous year. Trading volume on OpenSea, one of the largest markets for NFTs, fell from $3 billion in September 2021 to $350 million in September 2022.
Two years ago, NFTs were all the rage. Justin Bieber bought one for $1.3 million!!
This clip of Jimmy Fallon and Paris Hilton talking about their Bored Ape Yacht Club NFTs seems to really capture how absurd that time in history was.
Then reality caught up. Tons of A-List celebrities are being sued over various NFT-related allegations.
NFL PA is in good financial standing. Their assets grew from $1.003 billion to $1.055 billion in the last fiscal year according to the report reviewed by The Athletic. But the fallout from the NFT collapse continues, and there were almost certainly reports of this scale (of losses) in other industries in the coming years.