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Cryptocurrency Awards and Management for Athletes and Entertainers


Cryptocurrency and blockchain technology are rapidly transforming the world. Once the purview of technologists and millennial chat rooms, these concepts have been mainstreamed in recent years with user friendly videos from YouTube, itself a relatively new and transformative platform. To truly appreciate the rapid uptake of cryptocurrency, consider that El Salvador, a lower-income or emerging economy, has even gone so far as to adopt Bitcoin as its national currency. More businesses are accepting crypto as payment, more people are investing in various forms of crypto, and now, more athletes are engaging with crypto as competition prize awards and overseas currency options. So what is this cryptocurrency prize money trend, what are the pros and cons of receiving prize money in cryptocurrency instead of traditional fiat currency, and why would athletes and competitions want to go this route? This article is intended to broaden engagement with crypto for competitive athletes, endorsers, corporate sponsors, and event promoters. For specific questions, be sure to check out my contact links at the bottom of this page. 


Trends in Crypto Awards in Competitions

More organizations are now opting to award prize money to winners in the form of cryptocurrency instead of traditional fiat currency. Most recently and notably, the 2021 Rogue Invitational, an elite CrossFit competition, incorporated cash, Bitcoin, and ticket sales into the overall prize purse. An explanation of the winnings read, 

“Rogue has made an initial 1.25M contribution to the fund to establish the baseline payouts for competitors. $975,000 of this investment is held in cash and the $275,000 balance is held in Bitcoin. Bitcoin payout amounts will grow for each athlete accordingly based on coin price at that time of payout. Rogue’s minimum guaranteed price for each coin will be no less than $35,000 per.”

Per the invitational’s website, the purse rose from $1,250,000 to $1,490,583 at the time of payout. Though the invitational was arguably the largest scale competition in prize money and viewership (2.5M live views) to date to incorporate crypto, it was not the first. Earlier this year, an offshoot of the Meltwater Champions Chess Tours, the FTX Crypto Cup, added an additional $100,000 of Bitcoin to the winners prize fund. And in 2018, a Lithuanian marathon encouraged participants to use an app, Lympo, which enabled the runners to receive cryptocurrency along the route as they achieved personal fitness goals. 

Despite the growing traction with awarding athletes crypto as part of the overall prize purse, there are various pros and cons associated with utilizing these awards. From an athlete’s perspective, receiving crypto presents numerous advantages over cash prizes. However, there are some disadvantages as well. While crypto awards might be great for some competitions, they may not yet be suitable for all events. 


  • Avoiding International Fees
    • The fact that cryptocurrencies are widely unregulated can mean that receiving crypto for prize money frees up all sorts of logistical issues and exchange fees when traveling internationally. Additionally, crypto is an excellent payment method for transactions with international merchants who don’t want to lose money on currency conversion fees.
  • Anonymity
    • Obviously, winners of athletic competitions are always announced and celebrated, so anonymity is lost. However, cryptocurrencies allow for immediate anonymity as soon as the athlete gains control of the currency that they’ve won. And operating anonymously should not always carry a negative connotation. Some of the world’s largest donations come under the cloak of anonymity. Some athletes may prefer anonymity in purchasing valuable items that are sent to their homes so that they can maintain a level of privacy. 
  • Current Increasing Value of Cryptocurrencies 
    • According to Decrypt, over the last year, Bitcoin has increased +345.01% in value and +13712.24% over its lifetime. In keeping with those upward trends, awarding cryptocurrency provides athletes with more than just cash; it provides an investment. 
  • Increasing Spending Opportunities
    • As cryptocurrencies gain value and momentum, so too do the opportunities for athletes to spend those currencies. Daily, more merchants avail their customers the opportunity to purchase and pay via crypto. Currently,, PayPal, and AT&T are some of the most widely known merchants to embrace cryptocurrencies. 


  • Volatility
    • It’s no secret that with innovation comes risk – and cryptocurrencies are not immune. Ria Bhutoria, former director of research for Fidelity Digital Assets, writes, “Bitcoin’s volatility could also be explained by the fact that bitcoin has an intervention resistant market –no central bank or government can step in to support or prop up markets and artificially subdue volatility.” Bhutoria continues, “Bitcoin’s volatility is a trade-off for a distortion-free market.” The obvious drawback to a large crypto prize is the chance that the value of the currency could tank, leaving the athlete with next to nothing. This is why certain safeguards should be written into the competition’s guidelines. 
  • Demands for Regulation
    • Internationally, some countries, like El Salvador, are embracing crypto as a means to bolster their national economies. But here in the US, as Time reports, everyone from Congress, to the Federal Reserve, to the Security and Exchanges Commission are interested in having a hand in potentially regulating the currently decentralized and unregulated cryptocurrencies. Uncle Sam’s desire to have a hand in the prize purse has the potential to negatively impact an athlete’s overall winnings. 
  • Murky Legislation at Various Levels
    • Aside from the Federal level, the National Conference of State Legislators reports that various governments are dabbling in the cryptocurrency space and falling on a spectrum from launching exploratory committees to fervent acceptance. For example, Arizona and North Dakota have created study committees that will investigate blockchain, feasibility, and desirability of cryptocurrencies. Meanwhile, places like Miami and Louisiana, and South Carolina are attempting to pave the way for cryptocurrencies to thrive. The speed and veracity with which localities embrace crypto has the potential to inform the locations of major sporting competitions that wish to incorporate crypto on a larger scale. 
  • High Risk for Litigation
    • With decentralization and deregulation comes the disdain of both from regulating bodies. And disdain often leads to litigation. There have been recent lawsuits, court rulings, and settlements that are all informing how crypto is being received and will continue to roll out in the United States. August 2021 was a hotbed for crypto related settlements. The US District Court in NY’s Southern District ordered five BitMEX companies to pay a $100 million civil penalty for illegally operating a cryptocurrency trading platform and violating anti-money laundering procedures, per the entity that filed suit, the Commodity Futures Trading Commission. That same month, the Securities and Exchange Commission successfully settled two cryptocurrency disputes: one in excess of $10 million dollars for “operating an unregistered online digital asset exchange,” and the other totaling more than $13.5 million dollars for using decentralized finance to mislead ”investors concerning the operations and profitability of their business.” Currently, the SEC is facing off in court with Ripple Labs, Inc. for their cryptocurrency and its swift demise. In October 2021, the judge ruled that the six token holders can offer their own opinions about legal questions before the Court. The Ripple case is being watched very closely by cryptocurrency stakeholders, aspiring regulators, and now athletes alike for any potential precedent it will set. 
  • Security/Hacking
    • The recent uptick in cyber attacks has been coupled with requests for cryptocurrency as the primary form of ransom payment. The Colonial Pipeline hackers received $4.4 million in crypto ($2.3 million of which was recovered in Bitcoin by the Federal Bureau of Investigations), the world’s largest meat processor, JBS, paid hackers over $10 million in Bitcoin earlier this year, and even the University of California, San Francisco paid $1.14 million in Bitcoin to resolve a cyber attack. Obviously, there are major security concerns when it comes to offering athletes large sums of cryptocurrency in prize purses, which is why hardware wallets may be the safest form of transfer.
  • Confusing Tax Implications
    • In 2014, the Internal Revenue Service (IRS) deemed that virtual currency that is held as a capital asset is to be treated like property for Federal income tax purposes, per Notice 2014-21, 2014-16 I.R.B. 938. This notice can have implications for athletes and entities hosting competitions themselves, but only if the cryptocurrency in question is held as a capital asset. 

How Should Athletes Manage Crypto Awards

Rewards are great motivators for athletes. Everyone wants to win a trophy, but some competitions also offer prize money. But what’s an athlete to do with an unexpected crypto award? Here are some ideas:

  1. Immediately convert the crypto to a fiat currency. 

Unlike gold or silver that is backed by its own physical value, fiat currencies are backed by the governments that produce them; the most common example being cash. As evidenced above, crypto values remain in flux, so an immediate conversion to fiat currency via a marketplace, peer-to-peer exchange, Bitcoin ATM, or an alternative method, could be a means to avoid the crypto volatility.

       2. Invest in a hardware wallet. 

Hardware wallets are exactly what they seem – a tangible object that houses crypto currencies. These devices range anywhere from $59-$209 and have been ranked by Decrypt. These wallets can provide a true “handoff” from the competition to the athlete. 

        3.  Maintain a well encrypted software wallet.

If the appeal of a purely cloud based currency is too strong to overcome, a digital or software wallet is of course an option. However, it is best to ensure that whichever wallet the athlete chooses to house all of their cryptocurrency has encrypted, well-maintained, and as hacker-proof-as-possible standards in place to ensure that their hard earned crypto prize money is safe. 

       4. Identify marketplaces that operate on solely crypto exchanges.

Assuming the athlete isn’t interested in converting their crypto prize money into fiat currency, another option is to use their cryptocurrency in exchanges that can convert one type of cryptocurrency into another. As one might imagine, fees between exchanges and currencies can vary greatly, so extensive research in this area is recommended.

       5. Get a crypto debit card.

Various platforms have started offering debit cards that are linked to crypto accounts (just like an existing debit card is linked to a checking account). With these cards having the MasterCard or Visa seal, for example, on their plastic, they can be used wherever those carriers are accepted. Which is…as one might imagine…a lot of places.

Future Implications

There are a lot of potential advantages and disadvantages to consider when deciding whether a cryptocurrency prize purse should become commonplace in athletic competitions. Some states and municipalities may move to the forefront as prime locations for competitions with cryptocurrency baked into the prize purses. Photos of champions with their newly minted hardware crypto wallets could replace photos of the ever-popular oversized checks. Yet, depending on how some of the cryptocurrency cases are decided, more regulations could alter this playing field as we know it today. 

But if an athlete believes cryptocurrency’s future is bright or an entity already plans on accepting cryptocurrency as part of its business strategy moving forward, then it only makes sense to pay athletes for their hard work in cryptos too! Working with attorneys who know the ins and outs of the landscape is the best way for athletes and competitions to navigate this incredibly evolving terrain. 

As cryptocurrencies continue to gain popularity and approval around the world, athletes will have more options than ever before as to the type(s) of currencies they receive. For now, top performing athletes will always have a special place in cryptocurrency history as some of its earliest adopters. A special congratulations to Haley Adams and Guilherme Malheiros from Mayhem Athlete® for their Top 5 finishes at the Rogue Invitational and taking home a portion of the crypto prize purse! Rockridge® is proud to support Mayhem Athlete® programming and the Mayhem Nation Team.


About Torrey Feldman

Torrey M. Feldman, Esq. attended American University Washington College of Law for her Juris Doctorate in Washington, DC. Prior to law school, she received a Master’s of Science in Communication and Information with a concentration in Sports Journalism from The University of Tennessee, Knoxville.  Her legal practice includes amateur and professional sports, entertainment contracts and representation, emerging financial technologies, copyright, trademarks, alternative dispute resolution, and litigation. Read more about Torrey, Connect with her, and Calendly her. 


About RVL®

Rockridge Venture Law® is a certified B Corp law firm embracing the mantra of technology lawyers for good. Rockridge® services include corporate, intellectual property, litigation, M&A, privacy, technology, and venture capital law. Rockridge has been recognized as a B Corp Best for the World and Real Leaders Top 150 Impact Company, and has been featured by Conscious Company Magazine, Forbes, and other top media focused on industry leaders in impact and innovation.

The Rockridge team has worked with Grammy winners, Nobel Prize winners, and world champion athletes to create and monetize distinctive intellectual property assets. Rockridge clients include founders, investors, and multinationals scaling disruptive technologies and iconic brands. Rockridge is headquartered in Tennessee, with satellite offices in Durham, New Haven, and New York.

We’re Building Today’s Company for Tomorrow’s Economy® by leading clients through the dizzying array of information controls, by helping them to develop and monetize proprietary assets, and by enabling their impactful products, programs, and principles.

See case studies on how we’ve helped transformative companies at Rockridge Case Studies.


Torrey Feldman

Author Torrey Feldman

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