Why European Soccer Clubs Are Embracing Cryptocurrency
An increasing number of soccer clubs in Europe are embracing digital coins that allow fans to be a part of minor soccer decisions like the songs played at the matches after the goal or the images used on social media. These digital coins are called fan-tokens. The prices of these fan-tokens vary but major soccer initially launched these tokens at $2 each. Fans and investors can go to the website of the National Basketball Association to buy and trade non-fungible tokens (NFTs) in the form of the official videos of game highlights. The launch of fan-tokens comes in the light of a pandemic that has drastically affected the revenues of soccer. With no fan attendance in the soccer matches, the revenues of the top-20 European soccer clubs have dropped by 12% in 2020.
Some teams have also started to pay their players in cryptocurrency and digital fan-tokens while there are several others that also allow people to buy tickets and merchandise through cryptocurrencies. For example, the welcome package of sports superstar Lionel Messi includes the cryptocurrency PSG (Paris Saint Germain) fan-tokens. In less than 72 hours of this contract, the value of the PSG fan-token coins doubled. This shows that the financial revenues of the PSG football club will increase exponentially after the signing of sports superstars. In this piece, we will discuss how and why European soccer clubs are embracing cryptocurrency with open arms.
Embracing New Technology
Nowadays, a lot of crypto companies are sponsoring soccer teams to market their crypto services to young soccer fans. Recently, the cryptocurrency exchange Crypto.com announced its official partnership with the football club PSG. Through this sponsorship, PSG will be able to introduce its fan-tokens on Crypto.com.
PSG has been one of the earliest adopters of new technologies like blockchain and crypto. And through this partnership, it has again emphasized its vision for digital innovation. For Crypto.com, this partnership puts its platform on the radar of young football fans. Another example is that of Netherland’s PSV Eindhoven football club, which became the first club in Europe to have its entire sponsorship paid in Bitcoin after it signed a deal with the Dutch cryptocurrency company Anycoin Direct. The company announced that this partnership will boost cryptocurrency awareness in Europe.
For football clubs, these partnerships and sponsorships highlight their interest in new technologies and digital innovations that engage and attract younger soccer fans. While for cryptocurrencies, partnerships with soccer clubs are instrumental in expanding their audience and marketing their services. This highlights a substantial crossover between crypto adoption and soccer fans. Thus, embracing the rising waves of crypto will help football clubs stay on the top of innovation and thus, more popular amongst younger fans.
A number of soccer clubs are partnering with blockchain firms to offer fan-tokens. For example, Chiliz, a unit of Malta-based Mediatex Enterprises Ltd., has partnered with several European soccer clubs. In this partnership, Chiliz pays a fee to the club and shares the revenues generated by the sale of fan-tokens with the club. Chiliz has launched around 20 fan-tokens with different soccer teams and is targeting token sales worth $200 million this year.
The soccer clubs that have launched fan tokens in the last couple of months include the champions of the English Premier League Manchester City and Italy’s AC Milan. Argentina also launched its tokens in June. Similarly, Spain’s national team announced its plans to launch digital fan coins. These tokens can be traded on exchanges like other cryptocurrencies, which has attracted the attention of investors and professional retailers. Like cryptocurrencies, these fan-tokens are also vulnerable to swings and fluctuations depending on the market.
Use of NFTs to Add Value
The use of NFTs adds value for sports fans. NFTs are a type of asset that allows people to collect digital art, collectibles, or any other kind of digital asset on the Internet. In Europe, there is a craze over NFT amongst soccer teams. Several major European soccer teams including Real Madrid and AC Milan have entered into licensed partnerships with fantasy soccer game Sorare. In this fantasy soccer game, players are available as NFTs. This allows fans to trade the tokens of players and use them to compete in fantasy soccer games. Then, the teams are ranked on the basis of their player’s performance in the real world.
The auctions of these digital collectibles have generated huge interest amongst soccer fans. The highest bids go up to thousands of euros. For example, the token for PSG player Kylian Mbappe sold for €55,105.04 to a bidder called maxmersch. The unique Cristiano Ronaldo card sold for $28,990 on Transfer Market. This clearly reflects the financial potential of NFTs. Some soccer team owners are also thinking of allowing fans to purchase/sell season tickets using NFTs. This will allow fans to sell high-demand games from their session tickets and profit from their sales.
As discussed earlier, several European soccer teams are partnering with blockchain companies to offer fan-tokens. These companies allow soccer fans to purchase a part of their favorite team on their website. This will allow them to be a part of minor decisions affecting the soccer clubs. They would also have VIP access, rewards, promotions, and other benefits. Juventus FC, the Italian soccer team, was the first to introduce the fan-token on the Chiliz platform in 2019. With such tokens, fans feel more involved with their favorite soccer team. This is especially true in times like the pandemic when people were not able to go to matches.
With the explosion of decentralized finance, there is a vast potential for the sports industry to enter the digital economy and expand its revenue and audience base. The sales volume of NFTs and digital coins has increased by over 1000% during 2020, reflecting the rising interest of young soccer fans. With such a crypto erosion right over the horizon, it has become important for the sports industry to understand cryptocurrencies to keep up with digital innovation. At Unbanked, we allow our customers to buy, sell, and exchange cryptocurrencies. We provide transformative products and services to our customers that equip them to enter the crypto market with confidence. We help you to change the way you transact by enabling faster, cheaper, and better transactions. To know more about how we can help you grow in the booming crypto market, visit us today.