It's a complement: [G watching + O the players + C destroy their opponents] (Note, the object is the subject of the bare infinitive destroy.)
Verb(al)s of perception — hear, see, watch — and a handful of other verbs — help, let, and make — take a bare infinitive, an infinitive without the particle "to":
Verb: We watched the players destroy their opponents.
Gerund: Watching the players destroy their opponents ...
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