The Football Industry Adopts Cryptocurrency and Messi Helps Launch It

The salary package of Argentine star Lionel Messi, when he moved to Saint-Germain, included an out-of-the-ordinary clause in football transfer deals, believed to be a payment of one million euros spent in a cryptocurrency.

This is the result of a partnership between the French club in 2018 with Socius.com, where fans use a cryptocurrency called “chiles” to buy digital tokens that allow them to vote on issues related to the club.

Some issues are sometimes ordinary, such as the Italian Juventus posing the question of the music to be played in its stadium, but this concept spread quickly. The company developed rapidly after its partnership with Paris Saint-Germain and Juventus, to expand its circle of about 100 sports clubs around the world, including 56 football clubs, according to its CEO Alexandre Dreyfus.

Messi brought in more publicity, and Dreyfus believes the six-times best player in the world "will determine the trend". "This is an additional increase that will not replace any compensation. It is the reward that the players will start asking for," he told AFP from his office in Malta. "We hope that within two years during the Mercato (the transfer period), the player will say: Yes, I will go to this team, but it is better if they give me a million dollars in digital fan tokens."

Dreyfus admits that the Corona pandemic and the resulting financial crisis benefited his company, and allowed it to multiply partnerships, "Suddenly the clubs lost 50, 70 or 80 percent of their revenue. Then I came to the conclusion that we have fans around the world, what can we sell them?" It now has shirt sponsorship contracts with Italy's Inter and Spain's Valencia to promote digital fan icons.

Sponsorship recovery

A new analysis by KBMG Football Standards shows that more than 40 shirt sponsorship contracts have been conducted by clubs in the five major European leagues since the start of the pandemic. He says Inter doubled its revenue by moving from tire maker Pirelli to Socius.com in a $23.57 million deal.

Last July, Italy's Roma announced a three-year, $14 million-a-year contract for its T-shirts called "Digital Beats," an "easy-to-use blockchain used to power consumer digital assets."

Concerns

There are concerns about enticing curious adventurers into using cryptocurrency related products without having a proper understanding.

An example of its volatility, Chile's, the lesser known currency of Bitcoin, is up 58% four weeks after Messi came to the Qatari-owned club.

"At the end of the day, they are speculative products," says Maguire. "Someone described them to me as gambling."

Meanwhile, some fan groups have criticized their clubs' adoption of digital fan codes.

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