Thread by @meeseeking

Two of my favorite people collided worlds when @netw3rk read @econoar 's tweet about the @NBA's @SDinwiddie_25's tokenizing his contract on #Ethereum on the Emmy Award Winning #nbadesktop @ringernba.

What a time to be alive!

Thread 1/many

https://twitter.com/ringer/status/1218173376704860167

The great @ReformedBroker got the details mostly right, but oversold risk involved for easy Blockchain laughs. @SDinwiddie_25 is turning his contract into a bond, taking the money raised up front, and then paying those who hold the tokens a 2.5% rate until he repays principal.

This has been done before. #DavidBowie (EVER HEARD OF HIM???!!??) did this in the 90's & was met skeptically but ended up being a solid and memorable investment. The ambit of what Bowie wanted to do was much lower than what @SDinwiddie_25's end goals are.

en.wikipedia.org/wiki/Celebrity…

For the @SDinwiddie_25 bond, risk is not a blockchain one at all but both counterparty risk to syndicators & credit risk of lending to @SDinwiddie_25. 2.5% is only 75bps better than LIBOR (risk free) & maps to a low quality investment grade issue now. (Bowie priced tight too)

Counterparty risk & credit risk look low & it's unlikely anyone loses money on these bond tokens, they look pretty safe, but more like something that should price with a 4 to 5 handle, all things considered. What is missing though is the greater context of what this could mean

But the ambit is big, this is just a first step. The dream here is to be able to tokenize @NBA players contracts, essentially financialize the players themselves in ways that advantage them and give them more options to hedge against or bet on themselves.

An @NBA player's biggest financial asset is their collected future income from playing basketball. Their earnings career. This asset is a finite income stream of unknowable length and unknowable size. The risks they bear are immense. Finity, extreme competition, injury, trade etc

But if players earnings or contracts were tokenized as either a form of equity or bonds respectively, and liquid markets developed around them, they could access these markets to derisk their situations or to bring future income into the present to make investment or...

..to bet on themselves. For an example of the latter, @JimmyButler the grinding late 1st rounder who has worked himself into a superstar famously bet on himself multiple times by not taking lowball extension offers and waiting until he had more leverage. He believed in himself.

He bore a lot of risk in doing so, but it worked out. If the #Ethereum based contract/earnings tokenization that @SDinwiddie_25 is trying to do existed then, @JimmyButler could have both bet on himself by not accepting the lowball extensions & derisked himself by...

...going to liquid market for earnings tokens& raising money from investors that would pay him > lowball extensions wouldve AND allow those investors to participate in his earnings by betting alongside him that he will beat those lowball offers when he renegotiates his contract.

This would be great for @NBA players, it would allow them to leverage their own assets more effectively and allow them to manage the risk of those assets more effectively. It would be a godsend, an even better for people in the @NFL given their short contracts.

This is where it gets wild and really fun. This would unlock a whole new level of being a fan and supporting a player. Direct economic stakes in the future of players you love. Instead of a derivative meta-game like Fantasy or DFS, this would an actual real world economic market.

So when @BillSimmons says "I am buying everybody's @FCHWPO's stock, whoever is selling, I am buying, his first few years map to @Yg_Trece's." Bill could actually BUY tokens that correspond to that, participate more fully in his fandom, & financially profit if he's right.

What @SDinwiddie_25 is doing tokenizing his contract on #Ethereum is a step towards this, a brave 1st step by a forethoughtful man who wants to pioneer something revolutionary and fun. If it works, you and the @ringer & @ringernba are going to love what comes next.

I love to see it, @netw3rk's Ask the Maester was a mustread for me, @binge_mode's GoT was a mustlisten, and I've spent the last 8 weeks rewatching all of #StarWars in step with your pods, & #NBAdesktop is a mustwatch, so if you're here, thanks for the passion and laughs.

& if you or the @ringer crew want to learn more about the tech that enables @SDinwiddie_25's plans. coincidentally @econoar runs Ethhub.io, a resource intended to explain complex aspects of #Ethereum to anyone. It's a good jumping off point.

docs.ethhub.io/ethereum-basic…

Another person with pro sports connections & deep #Ethereum knowledge is @spencernoon, he does great AMA's on the subject and is likely to slot in a session with @SDinwiddie_25 on this.

@spencernoon @SDinwiddie_25 A correction that makes the bonds look better from @NTmoney:

https://twitter.com/NTmoney/status/1218656552866828288