• Visa White Paper Describes NFT as a ‘Promising Medium for Fan Engagement’

  • According to a recent white paper released by the global payments giant, Visa’s entry into the NFT market was driven by an assessment of the underlying technology and its ability to serve as a “promising medium for fan engagement.”

    The Aug. 23 publication describes the uncounterable token as a key innovation during the pandemic, during which strict in-place admission orders restricted live sports, entertainment and music festivals. Meanwhile, NFTs are emerging at a time when fans are eager to join digital communities centered on their favorite artists or sports teams.

    Professional sports have been particularly hard hit by the pandemic, with major leagues worldwide losing an estimated $18 billion in revenue. According to Visa, this further drives the “need to diversify revenues and focus on technology to reposition the business for growth opportunities and capture the attention of fans.”

    In this sense, “NFTs appeal to collectors, fans, teams, leagues and talent,” the report says. In particular, NFTs can be a major source of fan engagement, customer relationship management and renewed revenue streams. The main NFT use cases identified were collectibles, artwork and gaming.

    The whitepaper was released at the same time Visa announced the purchase of its first NFT – CryptoPunk 7610 – for $150,000.CryptoPunks are a collection of 10,000 unique NFTs with proof of ownership stored on the Ethernet network. According to industry sources, a total of 2,519 CryptoPunk collections were sold in the last 30 days, netting a total of $467.4 million. The highest-grossing sale during this period was CryptoPunk 7252, which sold for 1,600 ETH, or $4.5 million.

    In addition to the CryptoPunk boom, NFTs in other niches are also gaining popularity. In August alone, total NFT sales could exceed $900 million, a new record for the industry. The previous record was set in May, when total NFT sales reached $255 million. may was when the cryptocurrency market reached an all-time high, and then went through a multi-month correction.

    Visa’s foray into NFTs isn’t surprising given the growing focus on digital assets by payments companies. The company recently struck a deal with digital asset platform Zipmex to offer further cryptocurrency payments integration in the Asia-Pacific region. In January, Visa reiterated its commitment to establishing cryptocurrency payments and fiat channels to support the digital asset class.

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