Crypto is seemingly back on the agenda. The recent “Bitcoin Halving” in April 2024 – a process that occurs roughly every four years, reducing the reward for mining new blocks by half (making Bitcoin doubly-expensive to mine) – has boosted Bitcoin’s price and sparked renewed interest in cryptocurrency. With Bitcoin prices hovering around $70,000 USD at the time of writing and rumours of an Ethereum ETF being approved in the US, enthusiasm for Web 3.0 and blockchain-based projects is surging once again.

This renewed interest in cryptocurrency and blockchain technology is fuelling an increase in “Web 3.0” deals for football clubs (“Clubs”). These deals – often involving a blend of crypto, blockchain, the “Metaverse” and/or NFTs – present a lucrative opportunity to drive revenue for Clubs challenged by Profit and Sustainability Rules in an increasingly difficult economic market.

In our experience, these partnerships often involve Clubs collaborating with tech companies to license club IP into virtual and/or interactive worlds. This could mean creating a Club “Metaverse” environment as a unique digital experience for fans; building “digital twins” of the Club’s iconic stadium; licensing player and kit imagery for the creation of 3D avatars and skins; creating club-licensed NFTs to be owned and/or traded by fans; developing virtual stores where fans can purchase (physical) club merchandise (using fiat or cryptocurrency) directly within the virtual world; or even showing screenings of matches or hosting other club events such as player signings, games and exclusive player interactions within the digital space.

Given this evolving landscape, here are 5 top tips for Clubs to consider when entering into a Web 3.0 deal of this nature:

1. IP is key

Since IP licensing is often at the heart of the deal, it will be vital for the parties to (1) scope out precisely what IP is being licensed by the Club and for what purpose; and (2) address the ownership and usage rights of any newly created IP created using Club IP (“Club Digital Assets”), such as digital replicas of Club stadiums, kits and players developed as part of the partnership.

It will be an open point of negotiation as to who owns the IP in any newly created Club Digital Assets.  If the Club is unable to negotiate a full buy-out of IP rights in Club Digital Assets from the tech partner (or this is simply not desirable for the Club), then a “joint ownership” model could work – restricting either party from exploiting the Club Digital Assets beyond the scope of the partnership without the other party’s express consent. Alternatively, it may be possible to divide the IP ownership position up in respect of each Club Digital Asset.  

Certainly when it comes to depicting Club Digital Assets within the relevant Web 3.0 environment – the Club will want comprehensive approval rights over any final designs and will need to ensure it has all necessary third party rights in place to grant such licences of Club and/or Player IP to the tech partner (including in respect of player image rights and copyright from any original architect of the stadium).

2. Regulatory risks in respect of “cryptoassets”

Regulation of Web 3.0 and crypto is fast evolving on a global scale. Here in the UK, new rules were introduced back in October 2023 relating to financial promotions of “qualifying cryptoassets” (which includes cryptocurrencies and utility (fan) tokens, but excludes NFTs). The new restrictions mean companies wishing to make a “financial promotion” of “qualifying cryptoassets” in the UK can only do so legally if the financial promotion is communicated by an FCA “authorised person” (or otherwise approved by an FCA “authorised person”).

Depending on the specifications and functionality of the Web 3.0 product or “Metaverse” environment into which the Club is licensing its IP, it might be the case that marketing promotions of the product are caught by these new rules. The parties will need to carefully consider the applicability of the UK’s new crypto advertising rules and how these might impact the marketing plan around any such Web 3.0 partnership. We recommend taking specialist advice on this issue.

3. Exclusivity

Tech partners are likely to seek a level of exclusivity over the use of Club IP within the specific context of the Web 3.0 product – but Clubs will want to scope this exclusivity narrowly to avoid conflicts with other exclusive third-party arrangements, particularly those related to brand sectors of other official Club partners or any pre-existing deals with third-party NFT platforms.

Additionally, the Club should carve out personal arrangements of players, coaches, and managers from any exclusivity arrangements. Most clubs will need to require that the depiction of players in the digital environment is subject to the “3 player rule” – ensuring group representation of no fewer than three players together in official club kit within the digital environment, to avoid the prominent exposure of any one particular player and mitigate the risk of such player appearing to personally endorse the Web 3.0 product.

4. Payments and cryptocurrency conversions

Crypto and Metaverse deals often involve a revenue-sharing arrangement, splitting the net sales of Club Digital Assets sold within (or via) the Web 3.0 environment. To ensure revenue certainty, the Club may look to negotiate a minimum revenue guarantee with upfront payments.

For sales of Club Digital Assets to consumers made in cryptocurrency, unless the Club has a corporate crypto account capable of receiving and holding crypto, these sales will need conversion into fiat currency for the Club to receive its revenue share. We have helped Clubs draft specialist provisions dealing with cryptocurrency conversions and handling of blockchain network fees.

The financial stability of any Web 3.0 partner is crucial, as the crypto industry in particular has a reputation for instability and unexpected collapses (or “rugs” to use an industry term). The Club should conduct thorough due diligence to assess the financial health and stability of the tech partner and the contract should ideally include rights to financial audits, allowing the Club to periodically review the tech partner’s financial statements. 

5. Termination (and “permanence” of certain blockchain assets)

Termination considerations are vital when entering into any kind Web 3.0 deal. The Club may want to terminate the relationship for various reasons, such as breach of contract, regulatory changes, or reputational damage caused by the tech partner.

Upon termination, ideally the Club will want the tech partner to withdraw all Club IP from the digital environment. However, given the immutable nature of the blockchain, NFTs and other blockchain-backed assets are often “permanent” and can remain in circulation indefinitely, especially if held by consumer users and traded on secondary markets. This permanence is a risk the Club will need to get comfortable with at the outset of the deal, making it all-the-more essential for the Club to be fully comfortable with the final digital assets before they are issued.


If you are a Club entering into any kind of crypto or Web 3.0 partnership and would like to discuss any of the above in more detail, feel free to reach out to JJ Shaw who can guide you on how best to navigate these complex commercial deals.