Football industry embraces crypto as Messi helps fan tokens take off
Paris, (APP – UrduPoint / Pakistan Point News – November 24, 2021): When Paris Saint-Germain signed Lionel Messi, the salary package included something new for a player – a one-time payment, said to be worth around $ 1 million. ‘euros ($ 1.15 million), made as “fan tokens” of PSG.
It was the result of a partnership signed by the French giants in 2018 with Socios.com which sees fans using a cryptocurrency called “chiliz” to buy tokens allowing them to vote on issues related to the club.
These issues have tended to be rather mundane, for example, with Juventus asking what music they should play at their stadium, but the concept has caught on.
The company has grown rapidly since signing its first partnerships with PSG and Juventus to be involved in 56 football clubs and around 100 sports teams around the world, CEO Alexandre Dreyfus said.
Messi has done more publicity and Dreyfus believes the Argentine “will set a trend”.
“It’s more of a supplement that will never replace any compensation. It’s more like a bonus, but it’s a bonus that at a given moment the players will start to ask”, explains to AFP Dreyfus since his office in Malta.
“We hope that in two years, during the ‘mercato’ (transfer window), a player will say, ‘Yes, I’m going to this team but they better give me a million dollars in fan tokens.’ Dreyfus admits that the pandemic and the resulting economic crisis have benefited his company, allowing them to multiply their partnerships.
“The point is, clubs suddenly lost 50%, 70% or 80% of their income, and they realized, ‘Hey, we have fans all over the world, what can we sell them?’“ They now have fans. shirt sponsorship deals with Inter Milan and Valencia, promoting their fan chips.
New analysis from KPMG Football Benchmark shows that more than 40 shirt sponsorship deals have been signed in Europe’s five biggest leagues since the start of the pandemic.
He says Inter doubled their revenues by switching from Pirelli to Socios.com and a deal worth $ 23.57 million.
There is a mini revolution happening as companies related to cryptocurrency have started to appear on shirts.
In July, Roma announced a three-year deal worth $ 14 million per year that sees their shirts bear the name DigitalBits, “an easy-to-use open-source blockchain used to power consumers’ digital assets.”
“Not only can fans witness the story, but now they can own part of it,” Roma boasted. “Get ready to trade and collect. Join us as we move into the future of football.” The emergence of crypto-related companies in football comes as countries introduce regulations to crack down on gambling sponsorship – a ban is in place in Spain, for example, while the UK government is considering a.
“The door is ajar for new companies to step in,” says KPMG.
“Something has to fill the void and fan tokens, or something that is not defined as gambling but is gambling, will likely be the big ticket in town,” Kieran told AFP Maguire, Senior Lecturer in Football Finance at the University of Liverpool.
There are concerns that curious bettors may be trained to use crypto-related products without having a good understanding.
To highlight their volatility, the value of “chiliz” – a cryptocurrency less well-known than, say, Bitcoin – soared 58% in the four weeks after Messi’s arrival.
“At the end of the day, these are speculative products. Someone described them to me as gambling with a small G,” says Maguire.
Meanwhile, some fan groups have criticized their clubs for adopting fan tokens.
Aston Villa Supporters Trust told Joe.co.uk that their club’s deal with Socios.com was “totally inappropriate” and asked why fan engagement should be monetized.
Maguire said: “Clubs are targeting ‘non-inherited fans’ and asking,’ Can we make money with these new fans? “If we take Manchester United, they claim to have 1.1 billion fans and in a normal year they will make around 600 million pounds ($ 805 million) in revenue. So that comes down to around 55 pence per fan per year. . It’s pretty bad. ”For clubs, this is where Dreyfus, founder of the French gambling and online poker company Winamax, comes in.
“We’re talking about two different generations who don’t fight, they just don’t see the same things,” he insists.
“I always joke that we are not targeting a guy who has a tattoo and who lives next to the stadium.
“Our market is really more about digital fans, casual fans around the world who consume sport differently from you and me historically.”