How Data Analytics Transformed The NBA

5

October

2020

No ratings yet.

In the last decade, the National Basketball Association (NBA) has been undergoing a major (r)evolution by using data analytics. This change process may not have been visible to the average Joe, but has been going on since the early 2010’s. By then, multiple teams started to deploy an analytics department. Nowadays, these departments exist out of up to 20 data analysts, analyzing every facet of the game. And this strategy clearly paid off. One of the frontrunners in data analytics, the Houston Rockets, have transformed from a mediocre team into a title contender since the introduction of its data analytics team. How did this technology transform one of the biggest sport competitions in the world?

The NBA has been one of the frontrunners in the collection of data in sports. Every match, six high speed camera’s capture the player movements and other data points. These extensive data tracking systems result in up to a million data points per match. These data then gets analyzed by advanced machine learning algorithms, resulting in interesting insights that have changed the league.

First of all, data analytics have changed the overall strategy of the game of basketball. Prior to the data analytics age, many long range 2 point shots were taken by the players. After data analysis, these shots were found to be inefficient in terms of their pay off (measured in points * chance a shot hits the basket). Instead, data analysis showed that 3 point shots were a far more efficient way to score points. These shots had a lower percentage of being scored, but the higher points scored made the trade-off worth it. As a result of this changing strategy, elite three point shooters like Golden State Warriors’ Stephen Curry and Houston Rocket’s James Harden have become some of the most valuable players of the league.

Additionally, teams have been collecting sophisticated data about their players performance and fatigue. Analysis of this data by prediction models has resulted in advanced resting schedules for their players, in order to prevent injuries. Nowadays, teams might bench their key players to rest, even though they may not actually be injured. These schedules have proven to be the key to preventing injuries, in a league where a team can play up to 110 games per year.

Lastly, the last field where data analytics has proven its success, is in the field of scouting. Coaches and general managers now heavily rely on predictive analytics when acquiring new players. Advanced statistical models are created to predict which college & high school players will become the new LeBron James and Michael Jordan.

Data analytics in the NBA surely are not a golden ticket to winning championships. But in a highly competitive league such as the NBA, creating an edge (sometimes as little as 1%) over your opponent by using data analytics might actually make a difference that will win you the game. One thing is for sure, data analytics in the NBA is here to stay!

Please rate this

Decentralized Finance on the Blockchain: Fad or Future?

16

September

2020

5/5 (1)

Decentralized Finance, or DeFi for short, has been the topic of discussion in the communities of finance and blockchain lately. Many think that a shift from centralized finance (traditional financial institutions such as banks and hedge funds) to decentralized finance will happen in the upcoming decades, truly disrupting the world of finance as we know it. Others argue that DeFI is just another hype, comparable to the hype of the Initial Coin Offerings (ICO) back in 2017. Is Defi here to stay?

Decentralized finance refers to an ecosystem of financial applications that are being developed using blockchain technology. It aims to disrupt traditional centralized finance by facilitating financial applications and services, on peer-to-peer (P2P) blockchain protocols. This P2P nature eliminates the need for intermediaries and middlemen seen in the traditional finance industry. Previously, these intermediaries, in the form of banks and wealth management institutions, had control over who had access to these financial services. By eliminating these intermediaries, almost anyone with a connection to the internet now has access to a very broad range of financial products. This creates an enormous opportunity for those nearly 2 billion people across the globe that do not have access to basic financial services. Additionally, even for those who have access to basic financial services, DeFi could open the gates to a suite of complex financial services that previously only millionaires and billionaires had access to.
The applications and use-cases of DeFi range from standard lending and borrowing to more sophisticated use-cases such as mortgages, insurance, decentralized exchanges and complex financial instruments like leverage- and options trading.

Despite the potential, we need to acknowledge that the DeFi sector is still in its infancy. There are multiple hurdles to overcome before DeFi can reach its true potential. Some of these hurdles are inherent to the characteristics of a blockchain. Firstly, transactions on a blockhain are (practically) irreversible. This becomes a problem in case of fraudulent and/or money laundering transactions. Secondly, transaction fees on the Ethereum network, the most used DeFi platform, are somewhat high in comparison to other blockchains. Thirdly, the liquidity on most DeFi platforms is relatively low. Liquidity should however increase as DeFi gains more attention.

While DeFi might need some time to overcome these hurdles, it is clear DeFi has the potential to disrupt the Financial industry.

Please rate this