Bloomberg: Affected by declining incomes, football

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European football is becoming aggressive in trying to make money from the crypto world, writes Bloomberg.

Last week, Spanish club Sevilla and English Premier League team Crystal Palace released tokens that allow fans to buy services and vote on issues such as the color of the team’s jerseys. Manchester United, the largest club in England by number of fans, has agreed a sponsorship partnership with Tezos, a blockchain company.

At the same time, Manchester United are among the teams that have been in talks with Binance, the blockchain giant that already has agreements with Lazio in Italy and Porto in Portugal, according to people familiar with the situation. Other teams could be Newcastle United and Liverpool, they said. The three English clubs declined to comment. A company spokesman said Binance is in talks with numerous sports teams to explore potential partnerships.

It can be risky, but the attraction is obvious for a sport whose finances have been affected by the pandemic, as stadiums have been closed and leagues suspended as players’ salaries have risen more and more. The crypto market offers another source of money through digital merchandising and sponsorships from a growing industry.

Non-fungible token (NFT) sales revenue for the sports media could generate more than $ 2 billion in transactions in 2022, about double the 2021 figure, according to a Deloitte report released in December.

“Every sports entity will accept it in one way or another,” said Alex Dreyfus, CEO of Socios, the fan token specialist behind the agreements with Crystal Palace and Sevilla. The company has about 60 similar agreements with top European teams, he said in an interview.

However, for some clubs – as well as for many investors – the crypto market remains a “minefield”. Some teams are worried about the impact on their reputation among fans.

This is one of the issues considered by Newcastle, a Saudi-backed club, said a person familiar with the club’s strategy. Binance also wants to avoid any controversy over the Kingdom’s financial support for the team, said another person.

Another Premier League team, Wolverhampton Wanderers, calculates their own moves. In June last year, it was decided that Bitci, a Turkish company operating in the crypto field, would become a sponsor for a place on game shirts. Bitci has also announced that it will introduce a token for Wolves fans. Eight months later, the plan appears to be launched “soon” on the Bitci website. The club declined to comment. Bitci CEO Onur Altan Tan said in a message that everything is still on track.

“It simply came to our notice then. Payments to the team are made. Everything has been fulfilled, “he said.

Other clubs facing problems. In December, the UK advertising marketplace described the marketing of fan tokens promoted by London’s Arsenal team through Socios as “irresponsible”.

“We take our marketing responsibilities to our fans very seriously,” Arsenal said in a statement, adding that it would ask for a review of the ruling.

The balance sheet of the Spanish club Real Sociedad was left with a hole of over 800,000 euros, after the platform of involvement of the fans IQONIQ, its main sponsor last season, had financial problems.

“As with the Internet in the early 2000s, there is an understandable skepticism about crypto-based products,” Socios CEO Dreyfus said this week. “But they do create a new product line that is valuable to users and scalable to teams.”