Cryptocurrency is reshaping many industries and football is no exception. The intersection of football and cryptocurrency is ushering in a new era for world football. This article explores how cryptocurrency and blockchain technology are revolutionizing football, with a focus on club & national team sponsorships, fan tokens, merchandise, and player endorsements. We will also delve into the emerging controversies from this intersection.
- Club Sponsorships
Partnerships between football clubs and cryptocurrency companies are meant for the increased revenue for football clubs and a global exposure for sponsoring crypto companies. The top five European leagues have global viewership, in billion numbers. Each year, expensive TV rights are sold to big media groups which ensure the game’s transmission across continents and to wider audiences. Crypto firms carve for such an immense audience upon which they intend to enhance their reach. In return, football clubs can benefit from large revenues assisting them to overcome financially difficult times.
- La Liga
Spain banned betting brands’ sponsorships in 2020 so football clubs started to look for alternate avenues to earn revenue and started focusing on crypto brands and fan tokens. By October 2021, La Liga had signed $36.8 million worth of crypto partnerships. It also partnered with Socios, a blockchain platform, and Dapper Labs, a blockchain firm in 2021. La Liga extended its sponsorship to TVM, a Korean blockchain company in Feb 2024 when it signed a multi-year partnership deal. Barcelona formed partnerships with Chiliz, a blockchain project in 2020, and with WhiteBIT, a cryptocurrency exchange in 2022. Athletic Club partnered with B2BinPay, a crypto payment solution in 2023.
Recently, Kraken, one of the leading crypto trading platforms, announced its partnership with Atlético de Madrid in Jul 2024. These are just a few notable examples of crypto sponsorships. In fact, many other clubs have signed similar deals with crypto and blockchain firms.
- Premier League
In the 2024-25 season, 14 of the Premier League’s 20 clubs have partnered with blockchain and crypto-related firms. 15 different crypto companies including etoro, Socios, BingX, and Kraken have entered into sponsorships with the Premier League clubs. Last season (2023-24), eight clubs engaged in crypto sponsorships which also included Manchester City’s $70m sleeve deal with OKX, a crypto exchange, and Chelsea’s $10m partnership with BingX, another crypto exchange. In the 2021-22 season, only three clubs, Watford, Southampton, and Wolverhampton Wanderers had crypto-related sponsorships.
- Serie A
Serie A clubs have also embraced cryptocurrency. In Feb 2024, Juventus partnered with Zondacrypto to have Zondacrypto’s name on the sleeve of the men’s first-team shirts. Zondacrypto is a regulated cryptocurrency exchange in Europe with around 1.2 million active users. Atalanta followed suit in Aug 2024 with a three-year deal with Zondacrypto. AC Milan announced its crypto sponsorship with BitMEX, a crypto exchange in July 2023. Binance crypto exchange became the main jersey sponsor for S.S. Lazio, an Italian football club in October 2021. Serie A also partnered with Socios and Crypto.com in 2021 and 2022. Bitget exchange became the official sleeve partner of Juventus Women’s team in 2021. Recently on Aug 14, 2024, Inter Milan announced Bitpanda exchange as its official crypto partner.
- National Teams and Football Associations
Like football clubs, national football teams and football associations have also ventured into this arena. Before the 2022 FIFA World Cup, Argentina national formed partnerships with crypto exchanges Bybit and Binance. FIFA announced Crypto.com, with more than 100 million users and Algorand, a blockchain technology company as its official partners for the 2022 FIFA World Cup.
UEFA, the governing body of European football announced a multi-year partnership deal with Crypto.com in Aug 2024 declaring it as the official global sponsor of the UEFA Champions League. The deal included in-stadium activations, broadcast integrations, and advertising campaigns. Socios sponsored the Ballon d’Or Awards in 2021 and 2022. Similarly, One Football, a digital football platform, partnered with Animoca Brands in June 2024 to launch ‘OneFootball Club’ on Base blockchain. This club is intended to reward the loyalty of One Football fans.
- Fan Tokens
Fan tokens are digital assets that are used by sports teams to engage with their fans and community. They connect fans to their favorite sports teams and are usually issued using some blockchain-based application. Socios is one of the biggest fan tokens platforms which allows sports teams and organizations to create and sell fan tokens.
- Benefits for Fans
Owners of these tokens can enjoy multiple benefits. They can have voting rights on specific decisions and can have access to unique rewards. They can also enjoy VIP seating at games or behind-the-scenes tours of the team’s facilities.
- Team Fan Tokens
The 2022 FIFA World Cup was instrumental in promoting fan tokens as they reached to new heights in value during the World Cup. Fan tokens of national teams of Argentina, Brazil, and Portugal saw immense gains of 1038%, 324%, and 953% respectively. Many of the famous football clubs have issued their fan tokens to increase fan engagement.
Socios, a crypto fan token platform is the most prominent name which has partnerships with around 57 football clubs across England’s Premier League, Spain’s La Liga, and Italy’s Serie A. According to Coingecko, a crypto data aggregator, there are around 93 sports fan tokens with a market capitalization of $280 million and most of them are football clubs. Paris Saint-Germain Fan Token is the largest with $29 million market cap which is followed by fan tokens of FC Barcelona ($20 million), Galatasaray ($17 million), and Manchester City ($16 million).
- Merchandise and Endorsements
Football clubs are integrating cryptocurrency into their merchandise sales and payment systems. For example, Manchester United introduced “Fantasy United”, the first ever Web3 fantasy game in the English Premier League built on the Tezos blockchain in Jul 2024. This fantasy game will enable supporters to collect trading cards featuring first-team players and to compete against friends through mini-leagues.
Watford FC, an English football club offered its fans to own a piece of the club in Jun 2024 by selling shares in the form of digital tokens. The club intended to raise $22.38 million by selling a 10% stake in the club using a new financing method in sports and leveraging digital technologies.
Star football players are also getting involved in cryptocurrency through endorsements and personal investments. In July 2024, Lionel Messi and Ronaldinho endorsed Solana Memecoin WATER on their Instagram accounts. Other high-profile endorsements include Binance sponsoring Cristiano Ronaldo and Bitget sponsoring Messi.
- Controversies
The rush to integrate cryptocurrency hasn’t been without issues. There are multiple examples of crypto firms defaulting on their payments or teams not fulfilling their contractual obligations. Celta Vigo had partnered with Bitci, a Turkish crypto exchange in 2021 but the exchange did not make any payment to the club. Similar agreements of two other clubs Valencia and Espanyol with Bitci met with a similar fate. Cádiz was sponsored by Bitci in the 2021-22 season but the deal ended early after Bitci missed several payments to the club. Bitci also has sponsorship deals with Alavés and Real Betis. Real Sociedad’s main shirt sponsor of the 2020-21 season was Iqoniq, a fan token issuer. This deal ended as Iqoniq owed the club $875,000 in unpaid sponsorship fees.
Similarly, two Italian clubs AS Roma and Inter Milan had sponsorships with DigitalBits, a blockchain company, both clubs terminated their deals in Apr 2023 after DigitalBits failed to make promised payments to the clubs.
Binance and Argentinean Football Association (AFA) signed a sponsorship agreement in January 2022 but Binance terminated it in July 2023 accusing AFA of not meeting legal obligations under the contract.
Atlético Madrid entered a five-year partnership with WhaleFin in July 2022 but the crypto firm terminated its deal in early 2023 citing the crypto market crash as an excuse. Atlético Madrid then sued WhaleFin in Nov 2023 for €20 million in compensation.
- Risks and Challenges
However, the partnership between cryptocurrency and football clubs is yet full of risks and challenges due to the highly volatile nature of cryptocurrency markets and regulatory uncertainties. The fluctuating value of digital currencies can impact both sponsorship agreements and club profits. These partnerships can also lead to financial losses to customers due to the high volatility of cryptocurrencies.
The University of Liverpool Management School in its report in Oct 2023 warned that the promotion of crypto assets in professional sports is putting fans at financial risk and potentially damaging the reputations of clubs. The report highlighted that the volatile and largely unregulated nature of NFTs means that advertising such products can pose a significant risk of financial harm to consumers. These fears came true when star player Cristiano Ronaldo faced a lawsuit of $1B in Nov 2023 for promoting Binance. He had signed a deal with Binance in 2022 to create NFTs using his “CR7” brand. But some users suffered losses because NFT’s value fell from $77 to around $1 within a year.
- Conclusion
Undoubtedly, cryptocurrency is changing the football world. But there are also red cards to this fascinating relationship. High volatile crypto assets put clubs at risk of financial collapse and may expose their supporters to losses. Uncertainty over crypto regulations further distorts the situation. The potential of cryptocurrencies in football is still enormous, despite these obstacles. Together, clubs, financial regulators, and cryptocurrency companies need to set up clear and safe procedures that safeguard their supporters and ensure financial stability. By doing this, they can ensure that the beautiful game is strengthened rather than undermined by this technological revolution.