Why does security increase?

Thanks to the KYC procedure, frequently used on platforms that apply blockchain technology, it will be easy to track all ticket resales and place conditions on resale prices and many other parameters that may be useful for the safe conduct of an event. Very often through false identity DASPO recipients have managed to circumvent the restraining order. Undoubtedly such innovations could arouse interest and support from institutions. Other innovations are being implemented that could facilitate health tracking of the public attending an event, an application of great utility when we think of the pandemic period.

Tickets may also be used for Fan Engagement

NFTs replacing traditional tickets could be used as cards to access other goods, services or experiences dedicated by companies. Offering promotions and cross-selling items at a dedicated price, giving access to an experience upon reaching a certain number of NFTs could be just some of the commercial activities that could be pursued through this new tool. In addition, it would be easier for companies to keep track of fan activity, profile offerings by increasing customer satisfaction, and use commercial data to enable sponsors to generate higher ROI.

New ways of selling

What if companies want to sell their NFT tickets using different ways? This is also an advantage that this technology can offer. By leveraging external marketplaces that are compatible with the ticket’s Smart Contract, tickets could be sold through auctions. Leveraging external marketplaces is possible and also easy; it could be a good strategy relatively to exclusive tickets or conversely for last-minute tickets that remain unsold.

NFT ticketing has lower costs

It may seem strange, but the costs associated with selling and minting NFTs are far lower than the direct and indirect costs of the traditional ticketing system. The preconception around anything to do with blockchain is that it is an inaccessible technology, culturally and economically. This happens because most of the news that enjoys great resonance is about the record sales of an NFT or the staggering growths of Bitcoin, Ethereum, or even the market capitalization of other cryptocurrencies.
In reality, this technology is low-budget and therefore the biggest obstacle is cultural.
Cultural, in the sense of understanding the phenomena, but also in the sense of lack of know-how within sports clubs. The ability to create NFT tickets using blockchain is not and will not be exclusive to the top brands in global sports.

NFT Tickets: will their spread increase?

As was evident from the preceding paragraphs, the benefits of using this technology are multiple. The benefits of using NFT technology in ticketing are two-sided; organizers and guests are able to benefit from it. The latter play a role that is not limited to attendance at an event but can become all-round customers by using the right levers and determining their respective potentials as stakeholders. How is it then that this technology has not yet had a strong market hold when compared to other blockchain products such as Fan Tokens?

• The benefits that would succeed in using this technology are less intuitive than the operation of other products such as Fan Tokens;
• Tickets are assets that can be found even through the use of traditional methods;
• Revenue generated from other initiatives generates spot, but immediate revenue;
• Because it is a tool dedicated more to governance than to customers, it enjoys limited media appeal.

What may foster the development of this use will be the generational change of the prevailing segment of customers, who will be increasingly digital natives and attentive to innovations and new technologies.
It will be an audience increasingly devoted to interaction and intolerant of passivity, who will seek increasingly tailored offerings to meet their needs and feel part of a reality.
At the same time, a generational shift will take place that will also affect the governance of companies.
Certainly those who move with the right timing, identifying the needs of customers in the near future, will be able to gain more substantial slices of the market and with more ease considering the scarcity of competitors. Important will be to use the data extrapolated from this new mode of ticketing, which could be the most important touchpoint between event organizers and spectators.

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NFT Ticketing: the first applications

This use of blockchain and non-fungible tokens does not enjoy the same popularity as Fan Engagement tools, yet its application has already been successfully tested at the highest level.
UEFA first tested this technology at the Europa League final in Gdansk. Subsequently, ticketing on NFT was also used at the Champions League final in Porto.
Relying on non-fungible tokens made capacity management more agile and secure, checkered audience arrangement in compliance with anti-Covid regulations, speed and automation of refunds, and resale of refunded tickets due to the designation of a new venue.
Head of Revenue Operations Philippe Margraff said, “The two finals were handled excellently and demonstrated to us the effectiveness of blockchain-based mobile ticketing.” For this very reason, UEFA announced after a few days its intention to sell one million tickets at Euro2020 with the help of this new technology.

Tickets in NFT format: speed and process automation

Reading between the lines, it can be seen that the use of NFTs for ticketing has brought significant benefits in terms of speeding up and automating processes, all made possible by the Smart Contracts on which NFTs are based.
In fact, with smart contracts, reimbursements upon the occurrence of certain conditions-such as a change of location, a Covid positive or a forced quarantine-become automatic and fast.
Similarly, it is possible to easily transfer one’s ticket to another user.
Another advantage given by the use of NFTs in ticketing is being able to adapt very quickly to sudden changes in regulations caused by the progression or vice versa of the pandemic.
Once the know-how for designing and distributing NFTs is acquired, the creation time is also very rapid. Each ticket in NFT format can be ready for sale in less than a minute.
Distribution is also automated; the moment the ticket price is paid, the Smart Contract validates the sale of the NFT and delivers it to the chosen address.

Ticket on NFT: certified authenticity

Registering a ticket on blockchain is equivalent to guaranteeing its authenticity. In fact, each NFT has a specific digital authenticity certificate. The large-scale use of tickets on NFTs would put an end to the phenomenon of scalping or the phenomenon of selling fake tickets even online, and would also limit the so-called scalping 2.0, that is, the wild secondary selling practiced online by some brokerage companies.
We have not infrequently witnessed events that sold out within minutes only to see how large spaces turned out to be unoccupied. This happens because the markup applied in secondary selling, thanks to the artifactual scarcity of the asset, allows them to make a large profit even if not all the tickets are resold. Some companies have already been fined for these unfair practices. This situation certainly causes impatience in fans who buy at much higher prices or are excluded from the event they have been waiting for. What certainly comes out of it is loyalty. In addition, fans would be able to keep that ticket whose authenticity and uniqueness turn out to be certified in blockchain, without the risk of losing it … and who knows, this might become a collector’s item

Perpetual revenues

An additional opportunity arises for sports clubs: create a dedicated fan space for resale of tickets at a locked-in price and perhaps a commission to be charged on each resale. This kind of initiative would succeed in offering an alternative that would shield fans from speculative maneuvering. In addition, companies could leverage NFTs’ Smart Contracts to generate perpetual revenues. Should the ticket cover an iconic event, any resale made even in markets outside of corporate markets would bring royalties into the companies’ coffers.

In the next article of this blog, we will look at other aspects of ticketing in NFTs, including the benefits related to traceability (e.g., in terms of safety of sports venues), and cost reduction for adopters.

In the next article of this blog, we will look at other aspects of ticketing in NFTs, including the benefits related to traceability (e.g., in terms of safety of sports venues), and cost reduction for adopters.

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Another Play-to-Earn that has become famous recently is that of French startup Sorare. It set a record as the richest ever Series B round (investment round) in Europe, raising an impressive $680 million and reaching a capitalization of $4.5 billion. It is an NFT-based fantasy league that reprises traditional fantasy soccer. With 90% of users lacking blockchain expertise, game card purchases can be made using wallets that convert traditional currencies to Ethereum. Blockchain-related technology barriers are thus broken down and made invisible to consumers. Being based on Ethereum, the cards gain in interoperability, i.e. they can be traded on secondary marketplaces. This very feature is linked to the liquidity mentioned above. The digital collectible that was sold at a higher price is that of Borussia Dortmund’s Norwegian centre forward Erling Haaland at a price of 600 thousand euros.

The world of motorsport-related gaming has also experienced changes related to the advent of blockchain. Two Play-to-Earns were born, related to Formula E and Formula 1 respectively. The first one is called High Voltage and NFTs represent spare parts, developments and upgrades of single-seater drivers’ skills and can also be purchased on Binance’s NFT marketplace. The one related to Formula 1 is called Delta Time, in which NFTs also represent parts of real circuits. Owning an NFT of a circuit allows you to earn phee based on the number of users who use those tracks for their races: the rarer the NFT the higher the percentage of phee guaranteed to the owner. NFT sales and rewards are paid in REVV Tokens, a cryptocurrency native to both platforms. To monetize these tokens, simply transfer them to an exchange platform and sell them.

To stay in the world of motorsport we can mention the recent partnership of Scuderia Ferrari with the Swiss company Velas AG. The Swiss will be Premium Partner of the racing department of the Maranello team and Title Sponsor of the Ferrari Esports Series and of the Esports team that will compete in the F1 Esports Series. Again, NFTs, created by the Swiss team on Solana’s blockchain, will be useful to progress in the Cavallino stable’s Play-to-Earn.

NFTs as property deed

Thanks to the blockchain technology on which these products are based, NFTs are potentially configured as true deeds of ownership, certified and indisputable. Their deployment in ticketing is progressing in a spotty but continuous manner. The main national and international sports bodies, such as UEFA, have begun to adopt these systems or announced their intention to do so in the short term. Their use becomes decisive in gathering data, profiling fans and proposing targeted reward programs.

Also with regard to merchandising, these tools can be used to certify the ownership and originality of a good. For obvious reasons the value of the good, and therefore also of the NFT, is destined to grow when counterfeiting is made impossible and the property can be certified. We can therefore say that the transfer of ownership of a good cannot exist without the transfer of the NFT related to it. In addition, we have the first cases of digital-only merchandising, created in very limited series and bringing with them benefits beyond those of simple possession, such as the right of pre-emption on other merchandising goods and the possibility of accessing exclusive experiences reserved for owners.

NFTs can also be used to make their owners full-fledged shareholders of a company or a specific project. This is equity crowdfunding based on NFTs: their possession entitles the owner to participate in the distribution of part of the revenues in the percentages agreed upon in the purchase phase and regulated by the Smart Contracts registered on the non-fungible tokens. Some of the most striking cases are those of the casinos under construction on the metaverse of Decentraland and The Sandbox. Fifty percent of the revenues will be split between the owners of the 11,111 NFTs in the collection. Possession of lands in the metaverse, called Lands, is also certified by possession of the corresponding NFTs.

Will Fungible Tokens follow the example of Non-Fungible Tokens?

Fungible tokens differ from NFTs since they are all identical, i.e. they do not differ from each other: an example of this is the Fan Tokens sold to soccer team fans by platforms such as Socios.com. Fan tokens have enjoyed soaring popularity in 2021, launched by massive advertising and sponsorship investments by the platforms that market them, as well as hype generated by the novelty of the services offered.
The contracts in place between sports clubs and the companies that create Fan Tokens restrict their use to mostly virtual experiences and services created ad hoc for their launch. In addition, these types of tokens have proven to be subject to volatility that has generated a certain mistrust on the part of fans.
It will be necessary, therefore, to move towards a “maturity phase” of the Fan Token, which will inevitably pass through an adequate regulatory and fiscal structure, also taking into account the MiCAr regulation of the European Union that provides for much higher taxes on security tokens (savings and investment products) compared to those provided for utility tokens.

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n 2021, 0.04% of the world’s population bought an NFT: but the criteria for NFTs not to be a passing phenomenon, but a real outpost of the future, are all there.
In the year of the NFT explosion, in fact, we often heard of tokens being sold for record amounts. Why is this happening? Are these prices justified by real benefits or are they just part of a big speculation?

What determines the price of NFTs?

One of the most influential factors on the price of an NFT is definitely its history. For example, if an NFT is designed by a world famous creator, the auction base will surely be higher. Moreover, if an NFT has been owned in its history by a celebrity or an icon of the star system, the price, also in this case, will rise. In some cases celebrities may only be the testimonial of an NFT collection without having owned or created it. The higher the fame of the testimonial, the easier it will be to see sold-out NFTs from the collection, even at high prices.

Very often the NFT collections are in turn divided into various releases, even deferred in time: a technique adopted to be able to segment the offer, managing to meet the purchasing possibilities of the widest possible audience. Exactly as in other markets sensitive to the fame of the brand and to the availability of the good, the rarer an NFT will be, the more precious it will be.

Another factor characterizing the price is the liquidity and trading volume of a given collection. Liquidity is high when an asset is easily sold once it is put on the market: the higher the trading volume, the easier it will be to convert an NFT into cash or cryptocurrency to buy another asset.

he higher the purchase price of an NFT, the more difficult it will be to find a buyer willing to pay the amount spent: collectible NFTs, therefore, are subject to less liquidity.
Also the net on which the NFTs are mounted turns out a factor in a position to favor or less their liquidity. Minting is nothing but the publication of a non-fungible token on the blockchain to make it purchasable. There are many blockchains that support NFT, but for the moment the Ethereum ERC network, despite the high commissions (gas fees) to be paid for each transaction, remains the reference one. This happens precisely because of the liquidity it guarantees, being supported by the majority of wallets and NFT marketplaces of reference such as Rarible, OpenSea or Zora.

Utility: what makes an NFT most interesting outside of niches

But the element that most of all makes the purchase of an NFT virtuous is certainly its immediate utility. The utility of non-fungible tokens can be different depending on the ecosystem in which they are used. NFTs can serve to certify a digital or even physical property, can be an element of a game, represent a pass to access a good or service, or serve to guarantee the authenticity of a good, eliminating the possibility that the referenced good could be counterfeit. An NFT that has a well-defined utility, in everyday life, that is understandable even to non-experts in blockchain, becomes attractive even in the mass-market.

In the next article in this blog, we will illustrate how and why NFT can be useful and easily applicable even in industries that have existed long before their emergence, and that just by the advent of NFTs can be revolutionized.

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