Football Industry Embraces Crypto as Messi Helps 'Fan Tokens' Take Off

Lionel Messi has brought more publicity. (AP Photo)
Lionel Messi has brought more publicity. (AP Photo)
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Football Industry Embraces Crypto as Messi Helps 'Fan Tokens' Take Off

Lionel Messi has brought more publicity. (AP Photo)
Lionel Messi has brought more publicity. (AP Photo)

When Paris Saint-Germain signed Lionel Messi, the salary package included something previously unheard of for a player -- a one-off payment, understood to be worth around one million euros ($1.15m), made in PSG 'fan tokens'.

It was the result of a partnership signed by the French giants in 2018 with Socios.com which sees fans use 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 Juventus asking what music they should play in their stadium, but the concept has caught on.

The company has grown quickly since signing its first partnerships with PSG and Juventus to being involved with 56 football clubs and around 100 sports teams worldwide, says CEO Alexandre Dreyfus.

Messi has brought more publicity, and Dreyfus believes the Argentinian will "set a trend".

"This is more a top-up that is never going to replace any compensation. It is more like a bonus, but it is a bonus that at some point players will start to ask for," Dreyfus tells AFP from his office in Malta.

"We hope that in two years, during the 'mercato' (transfer window), a player will say: 'Yes I am going to that team but they had better give me a million dollars of fan tokens'."

Dreyfus admits the pandemic and resulting economic crisis has benefited his company, allowing them to multiply their partnerships.

"The fact is that clubs suddenly lost 50 or 70 or 80 percent of their revenue, and they realized: 'Hey, we have fans all over the world, what can we sell them?'"

They now have shirt sponsorship deals with Inter Milan and Valencia, promoting their fan tokens.

- Sponsorship bonanza -
New analysis by KPMG Football Benchmark shows that over 40 shirt sponsorship deals have been signed in Europe's five biggest leagues since the pandemic's onset.

It says Inter doubled income by switching from Pirelli to Socios.com and a deal worth $23.57 million.

There is a mini-revolution happening as businesses related to cryptocurrency have started appearing on shirts.

In July, Roma announced a three-year deal worth $14 million annually that sees their shirts carry the name of DigitalBits, "an easy-to-use open-source blockchain used to power consumer digital assets".

"Not only can fans witness history, but they can now own part of it," boasted Roma. "Get ready to trade and collect. Join us as we step into the future of football."

The emergence of crypto-related businesses in football comes as countries are introducing regulation to clamp down on gambling sponsorship -– a ban is in place in Spain, for example, while the UK government is considering one.

"The door is ajar for new companies to stick their foot in," say KPMG.

"Something has to fill the void and fan tokens, or something which is not defined as gambling but is gambling, are likely to be the big ticket in town," Kieran Maguire, a lecturer in football finance at Liverpool University, tells AFP.

- Concerns -
There are concerns about curious punters being drawn into using crypto-related products without having a proper understanding.

To highlight their volatility, the value of 'chiliz' -- a less well-known cryptocurrency than, say, Bitcoin -- shot up 58 percent in the four weeks after Messi's arrival.

"Ultimately these are speculative products. Someone described them to me as gambling with a small G," says Maguire.

Meanwhile, some supporter groups have criticized their clubs for embracing fan tokens.

Aston Villa Supporters Trust told Joe.co.uk their club's agreement with Socios.com was "wholly inappropriate" and questioned why fan engagement should be monetised.

Maguire says: "The clubs are targeting the 'non-legacy fans' and asking: 'Can we make some money out of 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 ($805m) in revenue. So that works out as about 55 pence per fan per year. That's pretty bad."

For the clubs, this is where Dreyfus -- a founder of French online gambling and poker company Winamax -- comes in.

"We are talking about two different generations that are not fighting against each other, they just don't see the same things," he insists.

"I always joke saying we are not targeting a guy who has a tattoo and lives next to the stadium.

"Our market is really more about the digital fans, casual fans all over the world that consume sports differently to you and me historically."



PSG Beats Toulouse 3-0 and Akliouche Double Gives Monaco Home Win over Brest

Lucas Beraldo of PSG celebrates after scoring the 2-0 goal during the French Ligue 1 soccer match between Paris Saint Germain (PSG) and Toulouse FC (TFC), in Paris, France, 22 November 2024. EPA/Mohammed Badra
Lucas Beraldo of PSG celebrates after scoring the 2-0 goal during the French Ligue 1 soccer match between Paris Saint Germain (PSG) and Toulouse FC (TFC), in Paris, France, 22 November 2024. EPA/Mohammed Badra
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PSG Beats Toulouse 3-0 and Akliouche Double Gives Monaco Home Win over Brest

Lucas Beraldo of PSG celebrates after scoring the 2-0 goal during the French Ligue 1 soccer match between Paris Saint Germain (PSG) and Toulouse FC (TFC), in Paris, France, 22 November 2024. EPA/Mohammed Badra
Lucas Beraldo of PSG celebrates after scoring the 2-0 goal during the French Ligue 1 soccer match between Paris Saint Germain (PSG) and Toulouse FC (TFC), in Paris, France, 22 November 2024. EPA/Mohammed Badra

Paris Saint-Germain retained a six-point lead at the top of Ligue 1 after a labored 3-0 home win over Toulouse on Friday.
The defending champion dominated the first half but it took until the 35th minute to open the scoring.
Young Portuguese midfielder João Neves spun to meet a cross from the right and struck a superb half volley from just outside the box.
Lucas Beraldo got a second with six minutes remaining when he pounced on loose ball and fired home, The Associated Press reported.
Vitinha made it 3-0 in stoppage time when he showed fine footwork inside the box to finish off a quick counterattack.
The scoreline was harsh on Toulouse, which came into the game in a more even second half.
Only Vitinha’s last-gasp tackle stopped Zakaria Aboukhlal from equalizing after 69 minutes and then Shavy Babicka blazed over from close range a minute later when he should have hit the target.
The win was a confidence boost for Luis Enrique’s side ahead of next Tuesday’s Champions League encounter at Bayern Munich.
PSG lies in 25th place in the 36-team Champions League table with one win in four matches and outside the playoff spots.
Monaco beats Brest: The win came immediately after second-placed Monaco beaten Brest 3-2 to briefly close the gap at the top to three points.
Brest, which faces Barcelona next week in the Champions League, turned in another inconsistent French league performance and not the sparkling form it has shown in Europe.
Brest has struggled in Ligue 1, where it remains 12th, but shone with three wins from four in its first ever Champions League campaign.
It was behind after just five minutes on Friday when Maghnes Akliouche scored with a superb airborne volley, and 2-0 down after 24 minutes thanks to Aleksandr Golovin.
The Russian striker seized on a poor pass just outside the Brest penalty area and his low shot was perfectly placed to sneak in off the post and give him his first goal in nine league appearances.
On-loan Brighton striker Abdallah Sima used his 1.88-meter frame to outjump the Monaco defense four minutes into the second half and cut the deficit but Akliouche restored Monaco’s two-goal cushion when he brilliantly finished a quick counterattack in stoppage time.
Ludovic Ajorque got a second for Brest in the sixth minute of added time but it was not enough in a second half most notable for the red card shown to Brest coach Éric Roy.