Up until this Summer, the NCAA rules put strict limits on the ability of college athletes to earn money. The debate over this matter had been going on for years, and it eventually reached the Supreme Court, which ruled NCAA’s conduct unconstitutional and declared that student athletes had the right to benefit from their image financially. NCAA athletic departments earned $18.9 billion in 2019.
As a result of the changes, college athletes have been signing deals with brands left and right as well as starting their own initiatives. Kayvon Thibodeaux told ESPN he’s been looking into crypto since high school. He decided to launch his own fan token following the NCAA’s new rules that allow athletes to exploit their name, image and likeness (NIL), and the trend around blockchain initiatives in sports.
According to Thibodeaux, his fan tokens are not meant to be perceived as investments. Instead, he is looking to create a community of fans. Unlike non-fungible tokens which are perceived as collectibles, fan tokens are viewed as typical cryptocurrencies.
“This is not an investment,” said the player on Twitter. “Consider it a membership into an exclusive community where you will have access to me as a fan or supporter.”
Ownership of fan tokens will give access to an online community, including a gated Discord channel and access to exclusive merchandise. Other reward structures and engagement opportunities centered around the fan tokens are still being strategized.
Like any fan token offering, more tokens give access to more rewards and exclusive experiences. Since the launch has not yet happened, it is hard to predict whether the community will be college football fans or crypto enthusiasts expecting the prices of the token to rise. The idea of having to pay to prove fandom and to access content that was previously free might be hard to sell to hardcore fans.
Thibodeaux is predicted to be an early first round draft pick at the NFL next year. Hence, the prices of his fan tokens might increase significantly. Despite his emphasis on the product not being an investment, it would be naive to ignore the possibilities of his sporting career development and how they will affect the token.
The initial price of the token is expected to sell for less than a dollar. Nevertheless, at least 100,000 tokens will be released at launch and there are plans to release a total of 21 million digital coins, which is likely to result in considerable revenue for Thibodeaux and Rally. Around twenty percent of the initial token revenue is to be allocated to the non-profit Jream Foundation, which the coin is named after.
Outside of crypto, Thibodeaux also signed a non-fungible token (NFT) deal with Nike founder Phil Knight for a piece of artwork.
Elsewhere fan token platform Socios.com has inked multiple deals with NBA teams. However, with the legal uncertainties around cryptocurrencies, the teams opted to partner for reward offerings and are not planning fan tokens yet.
Meanwhile, NFT platform RECUR signed a deal with CLC and Veritone for some exclusive content of the Pac-12 college organization. Other potential platforms in the NFT college athletics space include Tom Brady’s Autograph and Fanatics’ Candy.