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Sunday Thoughts – FC Bayern Munich Joins the Crypto Industry
The news hit like a bomb on Wednesday! The German football champion FC Bayern Munich joins Sorare. Sorare is a platform on which you can set up a team in an online
Fantasy Football League while you can trade and play with virtual football cards.
The virtual football cards that you can trade are NFTs.
However, what exactly are NFTs, and what makes them so valuable? Furthermore, what does this gigantic cooperation mean for the crypto space?
In today's SUNDAY THOUGHTS episode, I would like to provide some clarity.
First of all, what are NFTs? An NFT can be anything that is made unique by using computer code. It can be a collector's item, like a work of art or a football card, but also things like a
personal ID card, and so on.
The intention to make something unique is in the foreground! Of course, you could also copy Van Gogh's "The Starry Night" and, if in doubt, draw even better with even more beautiful colors. However, probably nobody would pay more money for this painting than for the original. It seems essential to us humans to own something rare, or even something unique. In the artwork of Van Gogh, there is only one painting of this kind, which is a significant reason for us humans to consider it as valuable.
Now you can recognize an identity card, a work of art, or other collector's items by various aspects as original or fake. Nevertheless, with NFTs, this is much easier! A thing is given a unique token.
So with an NFT, you do not need to check criteria or ask an expert to verify a piece of art. In a world where everything is becoming more and more digital, it is only the spirit of the time that property such as collectors' items or personal IDs can be digitized and made unique and forgery-proof using computer code.
In today's episode, however, the focus should remain on collectors' items. As already mentioned, the value of an NFT is similar to that of a collector's item. Nevertheless, the question is, how volatile are the prices of NFTs? Are they affected by similar price fluctuations as the entire crypto sector?
To draw a comparison between the prices of NFTs and cryptocurrencies is not easy. This is because NFTs are privately traded, just like collectors' items in the real world.
For example, someone who owns the "Blue Mauritius" (the most expensive and one of the rarest stamps in the world) will probably not sell it cheaper to someone just because other stamps have lost value or the US-Dollar exchange rate is falling.
However, a comparison between Bitcoin and NFT prices was drawn in the Zima Red newsletter on 01/22/2020. The average sales price and the total sales volume of NFTs in Decentraland, Cryptopunks, Cryptokitties, and Cryptovolex were compared with the daily Bitcoin prices.
The result of this comparison was remarkable! There is no correlation between Bitcoin and NFT prices. Since Bitcoin is the largest and most important cryptocurrency in the world, this comparison has some meaning that can be applied to the entire market.
NFTs could immensely increase in value in the future. If astronomical profits are made again in the next bullrun, investors will ask themselves how they can pull their assets out of the crypto market for a certain period. The profits of the bullrun could then flow into NFTs. Some investors in the crypto sector are reluctant to put their money in a bank. Therefore, a shift into physical gold and NFTs could be an attractive way for many investors to secure the profits of the bullrun.
However, what is the role of Sorare in the NFTs sector?
Sorare is a global platform for fantasy football. This means that players from all over the world can collect and buy virtual football cards. Players can also set up a team with their cards. Each card can collect points. The sum of points that each card can collect depends strongly on the real player's game performance.
If a user owns a Cristiano Ronaldo card, and he scores a hattrick for Juventus this weekend, the Ronaldo card owner will receive more points than if he had a card from a player on the team who was on the substitutes bench for the entire match.
The performance of the individual player in the real game is, therefore, elementary.
Because the more points the user's team earns, the better the team will finish in a tournament. The winner of a tournament can win prizes like rare football cards or even Ether!
So, if you put together a strong team at Sorare and bring a certain amount of football know-how with you, you could, in the long run, generate a permanent, passive income with
Fantasy Football. The individual football cards could become more and more investment-like.
This is also because the individual cards have different values.
There are four different types of cards: White cards (common cards), red cards (rare cards), blue cards (super rare cards), and black cards (unique cards).
White cards are not uncommon since every player gets them as gifts at the beginning of the game. Also, each white card has a parameter from 2.2 to 2.6. A black card is unique! There is only one black card per season from each player with a parameter of 21.6. The parameter indicates the factor by which the collected points are multiplied.
So if I own a white card from Gianluigi Buffon, and he saves two penalties in a match at the weekend, his points are multiplied by a parameter of 2.4 only. If you have a unique card from a Japanese player you have never heard of, but his black card has a parameter of 21.6, your Japanese player will probably collect more points.
However, the best is yet to come! With other forms of fantasy football, the value of each card expires every year. Why? Because a new season is starting.
Take FIFA ULTIMATE TEAM as an example; one of the most popular games with virtual football cards.
In this game, players collect cards from individual players throughout the season and then play against other players' teams. In other words, they actively play the FIFA video game with the players they have previously collected or purchased. The performance of the player in real life does not affect the video game at all. The paradox is that the cards have no real value. Because in this game, you could play with any team and play against other teams with much better individual players. However, as long as two equally strong FIFA players play against each other, the odds of winning are relatively even.
Nevertheless, these people sometimes spend a lot of money to have a particular player on their team. If then, like every year, the new FIFA game comes out, the virtual cards' value is completely lost. Because everybody now wants to play the latest version of the game. So you start from zero every year, and the cards lose their value every year. Nevertheless, FIFA ULTIMATE TEAM shows increasing user numbers every year.
However, this is not the case with Sorare. New cards are added every year, but you can use a single-player card as long as the player is active. Take Kylian Mbappe as an example. The French national player is only 21 years old and already one of the world's best football players. So, if I own his black card, I can almost be sure that he can collect points for me for the next 12 to 14 years with a parameter of 21.6 at an absolute top level.
Of course, this shows once again how much virtual football cards from Sorare could become an investment.
Nevertheless, what if the player ends his career? The player may not collect any more points, but the card remains. Especially here, the rarity of a card determines the value. Because even today, physical football cards from former football tournaments are still traded and acquired as collectors' items. For example, a Panini collector's booklet from the 1970 World Cup was last sold for 3000€, even though the World Cup ended 50 years ago. A similar collecting behavior could also occur with virtual football cards.
So, as we can see, virtual football cards could be affected by a similar collecting behavior as physical cards. Moreover, today's popular virtual cards cannot compete with cards from Sorare, as they do not lose their value completely every year. Furthermore, NFTs could become good stores of value soon. Therefore, investors would invest part of the bullrun's profits in football cards to protect their assets from volatility and inflation.
So it is clear that NFTs, especially Sorare's football cards, have enormous potential!
Last Wednesday, this was confirmed again because Sorare announced a cooperation with a giant: FC Bayern Munich!
For those who do not know: Germany is one of the biggest football nations in the world. Germany and Italy each won the World Cup four times. Only Brazil won more with five World Cups.
FC Bayern Munich is by far the most successful and best-known football club in Germany. The club won the German championship 30 times and the Champions League six times. This makes Bayern Munich the best football club in Germany and one of the best and most successful in the world! Last year FCB won the Champions League again, and many experts would say that this club is currently the best in the world.
As a result, the club has millions of fans all over the world! So, FC Bayern Munich is not just an ordinary football club, but a global brand!
On top of that, there will be radical changes in the club. Oliver Kahn, a former legendary player at Bayern Munich, will soon become the club's board chairman.
Above all, he represents the beginning of a new era: Oliver Kahn would like to make the club much more digital. At the beginning of the year, he said: "All the digital questions will not bypass football!" In this discussion, also a cryptocurrency was mentioned as an idea.
In plain language, this means: With FC Bayern Munich, Sorare has a partner who has an international brand and wants to develop further in the digital sector.
In addition to Juventus Turin, Atletico Madrid, and PSG, the next major football club is now joining Sorare's licensed clubs' ranks.
In summary, Wednesday's news was excellent for the entire Crypto sector. After all,
FC Bayern enriches the NFT sector very much, and enrichment is always right. The greater the acceptance of digital assets, the greater the acceptance of cryptocurrencies! We at DEFI TIMES can only congratulate Sorare for this cooperation!
What you may think of virtual football cards is less relevant. It is only essential to recognize the potential and importance of NFTs.
NFTs are only the beginning. The beginning of a new chapter in human history!
All information presented above is meant for informational purposes only and should not be treated as financial, legal, or tax advice. This article's content solely reflects the opinion of the writer, who is not a financial advisor.
Do your own research before you purchase cryptocurrencies. Any cryptocurrency can go down in value. Holding cryptocurrencies is risky.