The Premier League have shortlisted a company being investigated by the Gambling Commission as a potential partner as they prepare to launch a range of digital collectibles with a deal worth over £400million to clubs.
Sportsmail has learned that France-based Sorare are one of four companies in the running for the Premier League’s first NFT (non-fungible token) licence, with the bids offering returns of between £220m and £434m over four years.
NFTs are tradeable digital products bought online. Last year, a unique virtual trading card of Cristiano Ronaldo became the most expensive when it sold at auction for £300,000. That was eclipsed when one of Erling Haaland sold for £511,000 this month.
While clubs are enthusiastic about having an additional source of revenue from a contract that is due to start next season, the presence of Sorare on the shortlist raises eyebrows, not least as the NFT market has been widely criticised for its lack of regulation.
Last October the Gambling Commission opened an inquiry into Sorare, who also work with La Liga, after they launched a fantasy football game based around blockchain — a digital database used in cryptocurrency.
They launched it without obtaining a UK licence, leading the regulator to caution fans against using their products.
‘It has come to our attention the football-themed website, Sorare.com, is available to consumers in Britain,’ read a statement from the Gambling Commission. ‘Sorare.com is not licensed by the Gambling Commission.
‘This means any activity completed on the site is outside the gambling regulations that a licensed operator should comply with. Consumers are being advised to consider this information when deciding whether or not to interact with the site.’
The Gambling Commission told Sportsmail last night that their inquiry remains ongoing.
The winning bidder for the NFT licence will produce a range of digital products for the Premier League, such as virtual football stickers and trading cards featuring match footage and players at all 20 top-flight clubs, which will be sold to fans around the world.
Fans will be able to trade the digital cards, generating revenue for the clubs and giving them the opportunity to make money as their price will fluctuate.
The value of the Premier League cards, which will be based on Panini stickers, will be determined by supply and demand as well as players’ performances on the pitch.
The Premier League are understood to be close to be identifying a preferred bidder, which the clubs will be asked to approve next week.
The scale of the offers received by the Premier League dwarfs the deals already in place in other sports in the rapidly evolving NFT market, with basketball’s NBA and American football’s NFL both bringing in around £15m a year through their digital collectibles partnership with Dapper Labs.
The huge disparity is down to the Premier League’s decision to delay going to market and the size of the clubs’ global fanbases.
The rapid recent growth of NFTs in sport has caused controversy as, in addition to fans wanting to buy exclusive tokens linked to their favourite teams and players, the trading element has led to the creation of volatile secondary markets which are yet to be regulated.
Much of the secondary trading is linked to cryptocurrency and several suppliers have gone bust, leading to the prospect of fans losing money.
In its note to clubs on the tender, the Premier League are understood to state that the inquiry into Sorare is a concern, although they are still included on the shortlist.
The Premier League have declined to comment on the matter.
The other companies in contention are Candy Digital, who already have an NFT partnership with baseball’s MLB, Dapper Labs and ConsenSys.
The Premier League’s move into the NFT market comes a month after it began legal proceedings against John Terry as the former Chelsea captain was using their iconic trophy in the digital collection he has been promoting, which he has since removed.