NBA Says Basketball Player Can't Tokenize His Contract After All

Spencer Dinwiddie took a shot at tokenization, but the National Basketball Association blocked him.

The NBA said Friday that Dinwiddie's plan to pledge part of his contract earnings for a security token offering violates the league's collective bargaining agreement, according to the New York Times.

"The described arrangement is prohibited by the C.B.A., which provides that 'no player shall assign or otherwise transfer to any third party his right to receive compensation from the team under his uniform player contract,'" the league said.

It is unclear if the NBA spoke to Dinwiddie before providing the statement to the Times.

A publicist for Dinwiddie did not immediately respond to a request for comment.

Dinwiddie revealed Thursday that he intended to tokenize part of his contract on the ethereum blockchain, in order to raise $13.5 million from his three-year, $35 million contract.

As part of the DREAM Fan Shares platform, Dinwiddie outlined a company where any entertainer could tokenize their contract, raising part of their salary upfront to invest or otherwise use immediately.

Token holders would receive Dinwiddie's regular salary payments, recouping their investments and earning interest.

Dinwiddie's plan is receiving public support: on Friday, presidential candidate Andrew Yang, who has praised blockchain in the past and suggested a federal framework for cryptocurrency regulation, wrote that he thought the plan was "Genius." He added that he was "Disappointed the NBA is disallowing it."

Earlier Friday, Dinwiddie also revealed that he had partnered with the Tron Foundation and its CEO, Justin Sun, to donate 8.2 bitcoin to charity by selling his game-worn shoes for the 2019/2020 season.