Spencer Dinwiddie plans to use his three-year, $34.36 million contract extension with the Brooklyn Nets as a digital investment vehicle, according to The Athletic's Shams Charania.
The guard first agreed to the contract extension in December after earning less than $2 million in his first five NBA seasons.
The securitization will allow Dinwiddie to receive a small one-time payment and invest it directly in bonds as digital currency.
The 26-year-old will set up his own company to facilitate this transaction.
While no NBA player has used this payment method, former NFL player Arian Foster registered as a private equity investor in 2013, and current players like Vernon Davis and Alshon Jeffery have followed suit with initial public offerings.
Dinwiddie has also spoken openly about his support for cryptocurrencies, once explaining to Bleacher Report's Leo Sepkowitz in October that he owned several thousand dollars worth of Bitcoin.
"If I went all-in, well, I would have filled it up by now. I'd be all in," he said at the time.
He continues to discuss digital currencies on Twitter:
‘There will be billionaires made.’ Why one NBA player is all in on cryptocurrency
For Washington Wizards professional basketball player Spencer Dinwiddie, investing in cryptocurrencies is a threshold.
"I see it as the birth of a new asset class," Dinwiddie told CNBC's Kelly Evans at Wednesday's Your Money event. How many times in history has that happened?"
He went on to say that cryptocurrencies are where investors can multiply their initial investment by a factor of 10, as opposed to the 7% to 10% return that many expect to see in the stock market in the long run. It's important for generational wealth creation, the NBA player said, adding that he owns bitcoin and other digital coins.
The asset has been steadily gaining momentum as the price of digital coins has skyrocketed. On Wednesday, bitcoin hit an all-time high of nearly $69,000, up more than 130% since the beginning of the year.
Of course, cryptocurrencies are not without risk. The asset class has been very volatile on its way to historic highs, and that volatility is likely to continue.
Dinwiddie says, "If you have a long-term investment strategy and daily work that will help you last five or 10 years, view this asset class as very long-term because it's not going anywhere. There will be billionaires in this market."
Tyrone Ross, CEO of Onramp Invest, agrees that cryptocurrencies represent a huge opportunity for low-income people.
However, he warns that cryptocurrencies are not for everyone. But cryptocurrencies are not for everyone, he says.
If you take the time to research, read and educate yourself before investing, it's not that scary," Ross says.
NBA’s Spencer Dinwiddie Raises $26M for Social Token Platform Calaxy
Calaxy, the social token startup co-founded by NBA star Spencer Dinwiddie, has raised $26 million to expand its operations, the company announced Tuesday.
The funding round was led by the HBAR Foundation and Animoca Brands, and Polygon also participated.
The platform allows fans to connect with famous authors by purchasing video messages, online tutorials, video calls and fan club subscriptions.
The interface deliberately keeps the platform's cryptocurrency component inconspicuous, seeking to attract regular users and celebrities who are not cryptocurrency natives.
Solo Sisay, who co-founded the company with Dinwiddie, says he sees Calaxy as a new "Web 2.5" product that allows ordinary users to interact with blockchain services without having to understand the underlying technology.
"If everyone had to be an engineer to drive a car, there would be fewer people driving cars," Sisay told CoinDesk. "We took the technology of social tokens, plus the utility of Web2's already proven social platform, with a focus on monetization.
While the social token situation is still relatively fresh, Calaxy will have to face the same Web 2 platform, where OnlyFans and Cameo have launched their own Web 3 applications to integrate unfunded tokens (NFT), which will have an impact.
Calaxy previously raised $7.5 million in funding in June with NFL star Ezekiel Elliott and "The Bachelor" Matt James.