The agreement was quickly met with skepticism by experts, who cited the risks in the NFT market and surprise that BYU would place itself in the volatile industry.
BYU and Lehi-based Ocavu are creating a marketplace for digital trading cards and fan experiences. The plan has been met with skepticism.| Aug. 17, 2022, 12:30 p.m.to enter the world of NFTs, officials said they believed the venture might be worth $20 million in the first year alone.
“Other larger brands [in college football] have been hesitant to wholesale embrace NFTs,” Matt Brown said, who writes a newsletter about the business of college athletics. “The market is volatile. There is a reputational risk from the institution. And it is unclear how large the consumer demand is.” “When we first started having these NFT conversations, the NFT market was still really robust,” Casey Stauffer, BYU’s associate athletic director, said. “But from the very beginning we didn’t want [the marketplace] to be about speculation. We talked about creating experiences, something more valuable than saying, ‘I have a JPEG.”
BYU says that when a fan buys an NFT, they will also get other experiences with it. That, BYU believes, will make the platform more immune to the swings of the NFT space. The NFTs, they say, are just an avenue for people to buy experiences. However, some experts say that any value placed in NFTs is inherently risky. A major part of this deal revolves around an up-and-down market.
This was a red flag to Brown, who noted that NFTs are expensive to make. Ocavu said it has already spent $2 million in making the current NFTs. It also will likely spend $2 million more next year. Ocavu said it will take a portion of the profits to cover the overhead expenses.
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