The
National Basketball Association (NBA) notified Brooklyn Nets’ player
Spencer Dinwiddie that he cannot tokenize his $34.4 million contract.
As The New York Times reported
on Sept. 27, the NBA pointed out that Dinwiddie’s initiative goes
against the collective bargaining agreement in a statement sent to the
outlet. The statement reads:
“According to recent
reports, Spencer Dinwiddie intends to sell investors a ‘tokenized
security’ that will be backed by his player contract. The described
arrangement is prohibited by the C.B.A., which provides that ‘no player
shall assign or otherwise transfer to any third party his right to
receive compensation from the team under his uniform player contract.’”
Dinwiddie,
on the other hand, told the outlet that he intended to better
illustrate the investment scheme to league officials, hoping to change
their minds. He commented on his initiative:
“What
better way to be invested in a player as a fan than to have some level
of skin in the game. [...] With the way mine works, if I play well in
that player option year and we split the profits up the first year of my
new deal, it greatly appreciates the return on this investment
vehicle.”
Heightened fan involvement
Per the
report, by tokenizing the contract Dinwiddie would have allowed
investors to bet — and capitalize — on his ability to play well enough
to earn an even more lucrative contract after the second year of his
deal. As Cointelegraph reported on Sept. 16, the plan was to enable investors to buy into his three-year $34 million playing contract with his team.
According
to the Times, he intended to raise $4.95 million to $13.5 million by
offering an Ethereum-based security token developed by his company Dream
Fan Shares. He also reportedly intended to guarantee to investors a few
percentage points in interest over the duration of the contract and to
set the minimum investment to $150,000.
As Cointelegraph recently reported,
Turkish Football Club Galatasaray Spor Kulübü plans to launch
Ethereum-based fan tokens in partnership with blockchain sports fan
startup Socios based on sports tokenization platform Chiliz.
source link
