Today, I want to tell you about an industry on the verge of becoming a global mainstream market.
It also happens to be an industry ripe for the blockchain, but we’ll get to that in a moment.
The industry I’m talking about is eSports.
If you’re not familiar with eSports, it refers to competitive online gaming.
Here’s what you need to know about the industry: It’s growing faster than a California wildfire.
eSports research firm Newzoo projects revenues to grow 41% this year to $700 million. Going forward, revenues will reach $1.5 billion by 2020. That’s an annual growth rate of over 35%.
Its audience is growing rapidly as well. The global audience will reach 385 million in 2017, up 64% from two years ago. And it’s expected to reach nearly 600 million by 2020, growing over 20% annually from now till then.
Major Fortune 500 companies are already noticing the growth. Nike, Adidas, and Under Armour are all battling it out for sponsorship deals. Media rights are expected to grow sevenfold to over $330 million by 2020.
Suffice it to say, eSports is a huge growth opportunity.
And opportunities like these are exactly what we want to bring you in The Palm Beach Daily.
eSports and the Blockchain
eSports is a natural fit for the blockchain.
One key benefit is transparency. The decentralized system of the blockchain makes online gaming fairer. It prevents gaming companies from influencing the outcome of a game. And no player has a centralized advantage at any stage of the game.
But the real benefit has to do with money and financial transparency.
You may not be aware, but there are virtual economies built around these games.
Take Second Life, for example. In Second Life, players create avatars to interact with places, things, and other avatars. (An avatar is a virtual representation of yourself.)
And they buy and sell things, just like in real life, using the in-game currency Linden Dollars. What’s cool is that players can cash out Linden Dollars for real dollars.
In 2015, Second Life players cashed out over $60 million!
And if you converted all Linden Dollars into U.S. dollars, the virtual world’s GDP would be $500 million.
That’s just one example. Think of all the prize money sloshing around.
In 2016, there were over 400 eSports events with a prize pool of over $5,000.
But $5,000 is nothing in the world of eSports. One of the most popular games, League of Legends, had a $5 million prize pool in 2016. And for Dota 2, the prize pool was over $20 million!
eSports is a big business. Financial transparency is becoming increasingly important to the success of the industry.
That’s why I expect all eSports to eventually move over to the blockchain. The benefits are too large to ignore.
With it, all transactions are visible for verification on the blockchain.
Peer-to-peer transactions keep the gaming company from accessing players’ money.
Players hold their in-game assets outside the control of a central authority.
And as we’ve shown, the blockchain is far more cost-efficient than using traditional services.
Two Ways to Invest in eSports
So how do we play eSports and the blockchain?
Earlier this month, I showed you that there’s an exciting new “crypto” equities market flying under the radar. A common term for these crypto-equities is “app coins.”
Blockchain applications run on app coins. And we’re seeing app coins pop up across many industries, including eSports.
Here are two eSports app coins on my radar. You can buy them now if you want to get started right away. (We haven’t fully researched them yet, so do your due diligence.)
- First Blood (1ST): First Blood is a decentralized eSports gaming platform built on Ethereum. It allows individuals and teams to compete in matches for popular online games such as League of Legends.
- Game Credits (GAME): Game Credits is a digital currency used to facilitate in-game payments. The currency is instant, secure, anonymous, and easy to use.
[Note: These companies are not publicly traded. So you cannot buy them in your brokerage account. You can buy them on a cryptocurrency exchange.]
The second way to get broad exposure to the eSports explosion is to buy some bitcoin.
You see, bitcoin is the reserve currency of the cryptocurrency world. In order to buy other app coins, you need to buy bitcoin first. So naturally, as the demand for eSports app coins grows, so will the demand for bitcoin.
We recommend you use the Abra exchange to buy bitcoin. You can watch my free instructional video to learn how to set up your own account. If you’d like to do a bit more research on app coins before you buy, check out this free primer.
Analyst, The Palm Beach Letter
P.S. My colleague, Palm Beach Confidential editor Teeka Tiwari, has spent the last year diving deep into the cryptocurrency markets. He’s traveled all over the world and met with the leading cryptocurrency experts to learn about the most profitable plays the sector has to offer. And now, he’s hosting a special training series to share what he’s learned.
On April 17, Teeka’s free cryptocurrency training series starts. He’ll show readers how to get in on these once-in-a-lifetime opportunities. Get more information on what you’ll learn by clicking here.
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