NFTs (Non-Fungible Tokens), you’ve probably heard of them. They have been making the news recently for some high-profile sales.
NFTs are somewhat difficult to explain, but they are essentially digital assets, like online images that can be bought and owned on a blockchain ledger. For instance, the first-ever tweet on Twitter (sent by its CEO, Jack Dorsey) was recently sold for $2.9 million.
More often, NFTs are like pieces of digital art. Images, drawings, videos and, yes, tweets can sell for huge amounts of money, with the buyers presumably believing they will increase in value like fine art.
What, then, has this to do with horses?
Well, a story broke in the Wall Street Journal last week, detailing how the digital horse racing service, Zed Run, has secured millions of dollars in funding.
ZED RUN, which is owned by Virtually Human Studio, allows people to buy, sell and even breed virtual horses. Owners can race them in virtual races, and, if fortunate, they might see the value of their horses rise, later selling on for a profit in Zed Run’s marketplace.
As with the bits of digital art and tweets mentioned above, these virtual horses are NFTs.
The price of buying one ranges from around $130 up to $45K.
It’s difficult to get your head around, but the industry, while niche, seems to have a big future, as evidenced by the investment in Zed Run. The NFT craze is associated with the rise in cryptocurrency, and we have all seen recently how huge that has become.
Will virtual sports and NFTs impact racing?
But will this impact the traditional horse racing industry? For most of us who are equine lovers, the first reaction is to say – no.
This whole idea seems almost faddish, a by-product of the cryptocurrency boom. Nothing will replace the experience of training, riding and racing horses, which has centuries of tradition behind it.
And yet, the racing industry should not be complacent as to the challenges of the virtual world, particularly when it comes to the participation of younger generations.
Of course, this type of challenge is not unique to horse racing.
We have seen with other sports that there are questions over the influence of the virtual world. In soccer – the world’s most popular sport – there are questions of youth participation globally. And, the main culprit is said to be video games and the rise of eSports. Kids, they say, are more interested in playing FIFA video games than getting out to the park to kick a ball around.
Racing has already dabbled in the virtual arena.
The (UK) Virtual Grand National was a huge success after it replaced the real one after its cancellation in 2020. The audience share for the television network, ITV, for the virtual race showed there is an appetite for this kind of thing.
And, you can also see that there was sustained interest among punters for the virtual event in 2021, even though the real race took place.
All kinds of virtual sports are rising in popularity.
The betting industry obviously welcomes the idea of interest in virtual racing. I
n a blog post, Casino.com detailed the launch of its new sports betting platform, and it spoke of its relationship with software developer Playtech to create a high-end betting experience online.
On viewing that new sportsbook, it might surprise you to see the prominence of its virtual sports section. Playtech and Casino.com are two of the biggest gaming brands on the planet, so they will have obviously done their homework on interest in virtual sports.
But perhaps we are getting a little ahead of ourselves when talking about threats to the racing industry from a virtual world. After all, doomsayers have been warning us for decades that technology would turn the next generation into ‘zombies’. First, it was television, then video games, next the internet, and now social media and smartphones.
However, there is evidence of a decline in interest in horse racing across America, and that has been happening before anyone had heard of NFTs. For instance, a Medium post talked of the “decline of America’s first pastime” and pointed to the decline of “the number of tracks, total attendance, number of horses bred and racing, owners, purses paid to those owners, wagers placed by the bettors and the number of people employed by the horse racing industry.”.
Perhaps then, interest in virtual horses offered by Zed Run and others (Zed Run isn’t alone in exploring this market) might encourage people, particularly the young, to take an interest in the equine world.
In other sports, there is talk of athlete development through gaming. The science is sketchy, but the point is that the two areas need not be in conflict with each other.
But it’s worth remembering that we are at the beginning of something, and we don’t know exactly what the endpoint is yet.
Zed Run was only founded in 2019, and few had heard of NFTs, cryptocurrencies or eSports 10 years ago.
What will happen a decade from now? Will we be training, racing, buying and selling virtual horses?
It would be foolish to dismiss it all out of hand, although it’s hard to see real racing disappear given the passion of those involved in the industry.