The worlds of cryptocurrency and competitive gaming are converging at an unprecedented pace. From multi-million dollar sponsorship deals to NFT integrations and blockchain-powered tournaments, the synergy between these two digital-native industries is creating new opportunities and reshaping the landscape of modern entertainment.
The Rise of Crypto Sponsorships in Esports
The partnership between cryptocurrency exchange FTX and elite esports team TSM (Team SoloMid) marked a watershed moment. Announced in June 2021, the ten-year, $210 million deal included naming rights and comprehensive sponsorship, sending ripples through both industries.
This was not an isolated case. Years earlier, popular teams like OG and Team Vitality had pioneered the use of fan tokens through platforms like Socios, enabling supporters to engage with team decisions while generating new revenue streams. Throughout 2021, crypto companies including Coinbase, Uniswap, and FTX aggressively partnered with top teams, tournaments, and leagues. This trend continued into 2022 with a surge in NFT initiatives and Web3 gaming competitions.
What drives this ongoing integration? We examine the opportunities identified by industry leaders, the pursuit of deeper Web3 integration by esports organizations, and the potential for gaming to amplify engagement with NFT-driven experiences.
Shared Audiences and Cultural Alignment
Both crypto and esports attract young, tech-savvy audiences. These digital natives value virtual products and have witnessed both industries evolve from niche hobbies to mainstream phenomena.
The FTX and TSM deal serves as an ideal case study. Interestingly, the conversation that led to the $210 million partnership—including the team’s renaming to TSM FTX—began with a private Twitter message.
According to Walter Wang, TSM’s VP of Operations, founder Andy Dinh reached out to FTX founder Sam Bankman-Fried based on their shared interest in crypto and gaming. Bankman-Fried was known to be a League of Legends enthusiast, and TSM is one of the most recognized teams in North America’s LCS league. Their partnership was forged through mutual interest and developed rapidly.
Bankman-Fried’s public appearance in TSM merchandise epitomized the ideal consumer both brands aimed to engage: a plugged-in gamer who is also crypto-literate.
The Financial Dynamics: Investment and Need
Crypto companies want access to esports audiences, while esports startups need funding. It’s no secret that many teams operate at a loss, banking on long-term growth and broader industry adoption.
As teams like Guild Esports (backed by David Beckham) went public, financial pressures became more visible. Guild reported losses of nearly $6 million over a recent six-month period and was forced to downsize. Similarly, Astralis reported a $7.9 million loss in 2020 and $5.2 million in 2021. Even FaZe Clan, which went public via a $725 million SPAC merger, disclosed $52.9 million in revenue against a $36.9 million loss in 2021.
“Running an esports team is a labor of love,” says Mark Donovan, CEO of Web3 startup Kolex. “It’s not for the faint of heart.”
Despite these challenges, esports offers crypto brands highly targeted exposure at a relatively low cost compared to traditional sports sponsorships. 👉 Explore sponsorship strategies
Navigating Backlash and Skepticism
Not all gamers welcome crypto integration. Common concerns include environmental impact, scams, and the perception that NFTs represent another cash grab by publishers.
NFTs—blockchain tokens that prove ownership of digital items—can represent anything from profile pictures to usable in-game assets. Proponents believe they can transform gaming by enabling player resales, play-to-earn rewards, and interoperable items across virtual worlds.
“We believe fundamental value will be created through NFTs and blockchain over time,” says TSM’s Wang, who emphasizes the need for ongoing crypto education.
Chris Hana, formerly of The Esports Observer, compares NFTs to CS:GO weapon skins, which have sold for hundreds of thousands of dollars. Both tap into the desire for digital status symbols. He also notes that crypto faces the same skepticism esports once did: “There will always be detractors.”
Web3 Initiatives: Teams Building the Future
Amid the skepticism, esports organizations are charging ahead with Web3 projects:
- G2 Esports launched a Solana-based NFT collection granting access to an exclusive “Samurai Army” community.
- 100 Thieves distributed 300,000 free NFTs via Polygon, avoiding the term “NFT” in its campaign.
- Team Vitality plans to release NFTs on Tezos, while ESL introduced an NFT platform on Immutable X.
Some teams are going even further. Misfits Gaming announced Block Born, a Tezos-based platform that will release NFT games and host tournaments around them. FaZe Clan has hinted that Web3 could eventually account for 80% of its revenue.
Even leagues are experimenting: Activision Blizzard’s Call of Duty League co-hosted a watch party in Decentraland, an Ethereum-based metaverse.
Play-and-Earn Tournaments and Competitive Gaming
The fusion of crypto and esports has come full circle with NFT games launching their own competitive scenes:
- Axie Infinity, a Pokémon-inspired NFT game, plans to host a World Championship with a $1 million prize pool in AXS tokens.
- Gods Unchained, a card game on Immutable X, has awarded $570,000 in prizes and is expanding its competitive ecosystem.
- Community Gaming partners with Web3 developers to host tournaments with prize pools and professional casters.
According to Chris Gonsalves, CEO of Community Gaming, organized events are key to building community: “It’s all about engagement. Bringing people together for structured competition is incredibly valuable.”
The next wave of Web3 games may treat NFTs as optional status symbols rather than mandatory assets, focusing first on fun and free-to-play accessibility.
Frequently Asked Questions
Why are crypto companies investing so heavily in esports?
Crypto brands target esports audiences due to demographic overlap: both appeal to tech-savvy young adults who are comfortable with digital ownership and new technologies. Sponsorship deals offer cost-effective exposure compared to traditional sports.
How do NFTs benefit esports players and fans?
NFTs can represent in-game items, collectibles, or membership tokens. They enable verifiable ownership, potential resale value, and new forms of fan engagement—such as voting on team decisions or accessing exclusive content.
What are the major criticisms of crypto in gaming?
Common concerns include environmental impact, the proliferation of scams, and fears that NFTs prioritize speculation over gameplay. Some players also resist the idea of monetization mechanisms in games.
Can blockchain technology improve esports operations?
Yes. Blockchain can bring transparency to prize distributions, player contracts, and revenue sharing. Smart contracts can automate payments, reduce fees, and help combat fraud or match-fixing.
Are any esports teams profitable?
While many top teams operate at a loss, some organizations generate revenue through sponsorships, content, merchandise, and tournament winnings. Crypto partnerships have provided crucial funding during growth phases.
What is the future of crypto and esports collaboration?
Expect more NFT integrations, fan tokens, and Web3 gaming tournaments. As technology improves and education spreads, these collaborations will likely become more sophisticated and widely accepted.
The relationship between crypto and esports continues to evolve, driven by shared audiences, financial incentives, and a vision for more transparent and engaging digital experiences. While challenges remain, the potential for innovation makes this partnership one of the most watched intersections in modern technology and culture.