Whether you’re a cryptocurrency enthusiast or not, the chances are you’ve heard of Bitcoin by now. Some may argue that it is a store of wealth, while others say its value is made out of thin, air and the bubble is sure to pop.
Regardless of the ‘for’ and ‘against’ arguments, the entire crypto market cap now sits above $2.3 trillion, and money-hungry football clubs want a piece of the pie, which has led to the birth of the ‘Fan Token’.
With 29 clubs now offering fan tokens, according to data from bookiesignupoffers.com, the Premier League has stated that it plans to conduct an investigation between the growing links of its member football clubs and crypto-related companies, in what is still a largely unregulated market.
Fan groups are worried that the digital assets might drop in value, meaning supporters will lose cash. Also, these groups fear that children might be tempted to purchase these coins, which is possible as not all cryptocurrency exchanges do KYC (know your customer) checks.
Yet, somewhat ironically, the Premier League spokesman also confirmed that it is looking into a partnership with a crypto firm that mints ‘digital collectables’, more commonly referred to as NFTs (non-fungible tokens). This memorabilia won’t exist in physical form in the real world, and they are classed as assets, with their scarcity providing value in collectors’ eyes.
What is a Fan Token?
Socios, a leading creator of fan tokens for football clubs, claims,
Fan Tokens are your digital pass to the teams you love. Unlike normal memberships, Fan Tokens never expire and are yours to keep forever!
According to Socios, fan tokens offer a host of benefits, including:
- Own a share of influence of your team – fan tokens are limited in number, and are sold on a first-come, first-serve basis.
- Influence team decisions – fan tokens give you a voice on club decisions by voting in official polls.
- Earn extra rewards – some fan tokens might offer an airdrop to holders, which means you receive a second token that could have a monetary value.
- Trade – fan tokens can be traded on numerous cryptocurrency exchanges. Their value can go up, so you can profit from them. Equally, their value may go down, which is something to consider.
Of course, it’s a matter of opinion as to whether or not a person perceives fan tokens to have any real value. Potentially, it’s a little misleading to say that fan tokens can influence team decisions. This clearly doesn’t mean you’ll be voting on the starting 11 for next Saturday’s match. However, a vote could be put out to decide on the colour of the team’s training kit, for instance.
A word of caution
Fan tokens are digital assets (cryptocurrencies), and this asset class is known to be highly volatile. As an example, here is today’s price for the Paris Saint-Germain Fan Token (PSG), which is the leading one in this space.
- Today’s price: $14.93
- All Time High: $58.79
- All Time Low: $3.57
Clearly, if you bought the token at its lowest price, this has been a good investment. However, some people would have jumped in when the token was above $50.00, meaning their investment has lost around 70% of its value.