The Coinbase cryptocurrency exchange app pictured on the screen of an iPhone on February 12, 2018.Chesnot | Getty Images
The National Basketball Association is preparing for its 75th anniversary on Tuesday. But it also increased its presence in the cryptocurrency space as it braces for the future.
The NBA agreed to its first cryptocurrency sponsorship deal with Coinbase, the publicly traded company that makes an exchange for crypto trading. In the agreement, Coinbase will leverage just about all the NBA's platforms including the WNBA, NBA G League, NBA 2K League and USA Basketball. Terms of the deal were not provided.
Coinbase is a software platform that allows cryptocurrency transactions, and the company makes money from fees. Coinbase is traded on the Nasdaq under ticker symbol “COIN” with a $64 billion market cap. Coinbase stock was up 3.5% Tuesday afternoon.
The deal with Coinbase comes one day after NBA commissioner Adam Silver confirmed the league is projecting $10 billion in revenue for the 2021-22 season. That estimation is helped by fans returning to NBA arenas, which account for 40% of league revenue. Sponsorships accounted for about $1.4 billion last season, according to valuation firm IEG.
That figure should increase with the Coinbase deal.
The tech firm wants to increase awareness around blockchain technology to grow the crypto economy. Hence, the NBA will provide the company exposure including in Tuesday's regular-season tip-off games on WarnerMedia property Turner Sports. Coinbase will also get presenting partner rights for the WNBA Commissioner's Cup and the USA Basketball men's and women's national team exhibition tours.
A diamond-themed logo commemorating the NBA's 75th anniversary is shown on the court during a game between the Oklahoma City Thunder and the Detroit Pistons during the 2021 NBA Summer League at the Thomas & Mack Center on August 8, 2021 in Las Vegas, Nevada.Ethan Miller | Getty Images
In a statement, NBA executive Kerry Tatlock labeled Coinbase “a natural fit” for the league's cryptocurrency asset. NBA clubs have already leveraged crypto-related deals, including the Portland Trail Blazers' jersey patch and Miami Heat arena naming rights.
Sports leagues have embraced cryptocurrency sponsorships this year, as its helping with a V-shape recovery for leagues following pandemic losses. NBA teams, Formula 1, Major League Baseball and even New York-based Drone Racing League have landed crypto sponsorships. Platform Algorand will pay DRL $100 million over five years, and last June F1 also struck a $100 million deal with Crypto.com.
The National Football League hit pause on crypto deals, though. Last August, the NFL restricted its teams from negotiating sponsorships as it studies the business, according to The Athletic. But the NFL may reconsider crypto agreements especially with its Super Bowl halftime show rights on the market.
The NBA's 75th anniversary season starts Tuesday with a doubleheader as the defending champion Milwaukee Bucks host the Brooklyn Nets. The second game will feature the Los Angeles Lakers and Golden State Warriors.Internet Explorer Channel Network