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Is it time to ban football fan tokens?
Football fan tokens from Spain and Argentina have both plummeted in value recently, despite both teams winning major tournaments. Many of the larger coins are down more than 90% from their all-time highs.
You might expect a club soccer fan token to be used as reinforcement in case they win a major tournament.
But how Spain discovered after defeating England to lift the Euro 2024 trophy, but that’s not always the case.
Ahead of the final, the Spanish national football team token (SNFT) had surged to highs of $0.039, amid hopes that history was about to be made.
But over the next three days, a drastic 43.5% decline occurred, with this token now languishing at lows of $0.022.
SNFT over the past seven days | Source: CoinMarketCap
The situation gets even worse if you look away.
Data from CoinMarketCap suggests that the all-time high for SNFT was $0.8633, a record set in September 2022.
Less than two weeks later, it has lost 97.4% of its value.
SNFT value since launch | Source: CoinMarketCap
This token was an official initiative by the Spanish Football Federation, which stated that it wanted to be one of the first national teams to jump on the bandwagon.
But if nothing else, it could be argued that teams that have launched their own cryptocurrencies have done nothing but cause financial harm to fans.
Each of the five largest football fan tokens, led by Paris Saint-Germain, FC Barcelona and Manchester City, have suffered dizzying drops in value in recent years.
At the time of writing, PSG is languishing at $2.83, down 95.4% from its all-time high of $61.23 set in August 2021. BAR has lost 97.5% of its value in the past three years. Meanwhile, CITY is nursing a 93.7% loss.
Each launch is often accompanied by high-profile and shiny endorsements from fan-admired football stars. And when Lionel Messi made a big-money move for PSG, part of his fee was paid in fan tokens.
Argentina The official fan token also suffered a similar fate, despite securing a 1-0 victory over Colombia in the Copa America final.
The ARG had recovered well before that fateful match, but within a week it had collapsed by nearly 50%.
ARG Price in the Last Week | Source: CoinMarketCap
Football and cryptocurrencies intertwine
In recent years, the ties between cryptocurrency companies and football clubs have grown increasingly stronger.
While there was a little break during the bear market, exchanges they are now again engaged in high value-added partnerships in an attempt to educate sports cryptocurrency enthusiasts.
Just this week, The Kraken announced it was becoming the “Official Crypto and Web3 Partner” for Tottenham Hotspur, building on a deal recently signed with Atletico Madrid. Their logo will also appear on the sleeves of the club’s kit. The exchange’s UK managing director, Bivu Das, said:
“In the UK, cryptocurrencies already have a widely recognised name. Our research shows that cryptocurrencies are more popular than many traditional financial services products. The partnership with Tottenham is about taking this technology a step further and filling the knowledge gaps that are preventing some football fans from getting involved in the cryptocurrency ecosystem.”
Das Bivouac
Although club sponsorships have nothing to do with fan tokens, some critics are alarmed by the trend of cryptocurrency firms sponsoring football clubs, mainly because the volatility of digital assets makes them akin to gambling.
Source: Kraken
The UK is not a fan of fan tokens
In a report last October, a group of British politicians went so far as to say that football clubs should be banned from offering tokens to fans altogether. The chair of the Culture, Media and Sport Committee, Dame Caroline Dinenage, said:
“In the world of sports, clubs are promoting volatile cryptocurrency schemes to extract additional money from loyal supporters, often with promises of privileges and perks that fail to materialize.”
Mrs. Caroline Dineage
He noted that groups representing football fans have expressed concerns about these digital resources, mainly because they only allow fans to vote on arbitrary things, such as which songs to play after a goal.
Companies involved in issuing fan tokens were defensive at the time, and in a statement to British news agency Sky News, Socios argued that it was a valuable tool for fan engagement.
“Fan token holders received more than 24,000 match tickets and over 1,000 items of merchandise last season and continue to engage with their club in new and unique ways.”
Members