Fan Tokens in 2023: Engagement for True Fans
This blog post will cover:
- Use cases
- A bit of statistics
- Quick Q&A
- Titles to consider in 2023
- Future trends
For the longest time, fan engagement and support in the world of sports, including sports teams, players, and clubs — was quite passive. Fans would usually buy memorabilia, tickets, or items while the club, team, or athletes earned the cash from the sales they make, representing a unidirectional ecosystem which has served as the norm for the industry for decades.
However, now we have blockchain-enabled “merch”. These digital assets have been in use by sports teams, clubs, and celebrities to foster stronger relationships in the form of fan tokens — establishing a new symbiotic relationship for all parties involved. Today we will learn a little more about this type of crypto assets and see if they are still in demand in 2023.
Fan tokens bestow upon holders the access to a wide array of related perks like voting on club governance, incentives, VIP experiences, and product designs, among others. All of these possibilities allow people to engage in their fav club’s life.
Sports teams, athletic clubs, fan clubs, designers, brands, and organizations can leverage fan tokens to democratize governance, make their voices heard on decisions that shape club policy and tokenize engagement for a fandom’s most dedicated fans.
Fan tokens, for instance, may be leveraged as a medium of exchange for club items and merchandise, exclusive interactive VIP events, not to mention strengthening their ties between the fanbase.
The general premise of fan tokens is that an organization like a sports club mints fungible cryptocurrency, offers them to fans, so they can engage and have a voice in key governance proposals, merchandise design and development, besides distributing them to traders.
The most prominent use case for fan assets is in the sports world, with sports club tokens, particularly in football, as the most renowned exponent of this technology.
Notable football clubs that have implemented the use of fan tokens to engage their devoted fan bases include 7-time English Premier League Champions Manchester City FC (CITY), French football powerhouse Paris Saint-Germain FC (PSG), and fourteen-time UEFA Champions League winner Real Madrid FC (REAL), just to name a few.
On the other hand, professional MMA organizations, notably, the Ultimate Fighting Championship, has launched its very own fan token (UFC) to grant exclusive access to social features, fan communities, and VIP experiences.
However, the use case of fan tokens doesn’t begin and end with sports clubs or sports leagues. For instance, professional athletes, celebrities, digital artists, and influencers from all industries can also offer their own NFT fan tokens signifying membership in an exclusive group that gives fans exclusive access, content, merchandise and deeper interactions with a particular celebrity or influencer through ownership of NFTs or their respective cryptocurrencies.
For example, one of the popular movie firms “Mogul” introduced fan tokens (STARS) which give their owners a chance to vote, greenlight and participate in decision-making of movie production.
Сybersports keeps pace with the trends — some teams have already created their own fan tokens. For instance, the OG esports organization has the OG token which brings the following benefits: meet-and-greets with players, behind-the-scenes access, exclusive merch, or VIP event invitations.
A bit of statistics
Coinmarketcap provides its own top of fan tokens considering their market capitalization. Here are first 5 assets as of June 2023:
Now take a look at the fan tokens sales volume from 2020 to 2023:
Obviously, the demand has increased by this year, which, in turn, led to a growth in monthly sales volume:
In April 2023, the sales of fan assets exceeded $2.20b. These numbers have beaten the record of 3 years, meaning that fan tokens are still in high demand.
If you’re new to the world of fan tokens, you might have questions concerning these assets and their performance. Let’s try to make it clear.
- Does the performance of the teams influence the price of the tokens? The price is mostly tied to the importance fans place on the exclusive privileges of fan tokens. As more token holders use them to participate in related events, their worth increases. And as with any crypto, it’s quite difficult to predict whether a fan token will grow in price or not. To make it a little easier, you might check out the price predictions for such fan tokens as Santos FC, Atletico De Madrid or Chiliz. But remember to do your own research before making any investment decision.
- Does one get a share in the club or organization when buying a fan token? Absolutely not. Fan tokens are not traditional stocks, thus they do not provide anyone with ownership rights.
- Can you make money with fan tokens? As with any crypto, you may buy or sell them for your own profit. However, the core value of fan assets stems from the perks that come with them.
- In what ways do clubs, leagues, and UEFA generate revenue from fan tokens? It all comes down to fees. The distribution model plays a significant role, as teams secure a substantial portion of the transaction proceeds during the initial fan token launch. Furthermore, they continue to earn fees tied to fan token activities associated with their clubs.
- Are fan tokens securities? No. They do not neatly fit into a specific asset category that falls under the jurisdiction of the SEC.
Titles to consider in 2023
If you are looking for a fan token to own, you can check out the following ones:
The BWT Alpine F1 racing team presents its creation, a fan token. It opens up a world of unparalleled fan experiences and grants the Alpine F1 enthusiasts the power to participate in voting processes concerning team decisions. In addition, the token incorporates a scarce selection of NFTs that can be staked to unlock rewarding opportunities.
The ownership of this unique asset lies with Manchester City, a globally renowned team that boasts an impressive record of securing four Premier League titles. Socios serves as the platform for trading this particular token.
With Manchester City's recent triumph in the Premier League this season, the team has garnered an expansive and devoted fan base, establishing itself as one of the largest in the realm of football.
Launched in 2021, this token derives its name from Santos FC, a prominent Brazilian football club that has its headquarters situated in Vila Belmiro. Boasting a rich legacy of over 110 years, the club has amassed a loyal and dedicated fan base. Notably, Santos FC has nurtured renowned football icons such as Pele and Robinho, further enhancing its illustrious reputation.
These are just a few assets to pay attention to. There are 89 fan tokens and counting as of 2023. You may pick the token of your favorite team and become a member of the sports community with privileges.
More sports clubs are harnessing the potential of fan tokens to provide exclusive customer experiences, unique content, and direct engagement. Major clubs across football leagues all over the world, such as Juventus AC (JUV), FC Barcelona (BAR), and FC Porto (PORTO), are already in on the technology.
Necessity is the mother of invention — fan tokens have come a long way from their initial introduction during the height of the COVID-19 outbreak. Fan tokens were launched as an innovative iteration of web3 technology when live events were temporarily suspended, forcing sports teams to find alternative ways to engage their fans during the pandemic.
We’ve barely scratched the technology’s potential. Ultimately, fan tokens are another exciting application of distributed ledger technology that has changed — and will continue to transform — the fan experience and relationship dynamic between the teams, athletes, and celebrities they love. We have already discussed this in our previous articles about crypto in the sports sector and football teams in metaverse. In 2023 and beyond, we can see the interest in fan tokens continue to rise, a trend that will continue, as their rising number indicates.
If you would like to join any fanbase, check out the fan tokens available on SimpleSwap — you could possibly find your favorite team on the list.
SimpleSwap reminds you that this article is provided for informational purposes only and does not provide investment advice. All purchases and cryptocurrency investments are your own responsibility.