2021 proved to be the year for the NFT, and it might be that 2022 is the year that the fan token takes off in the U.S. Why? Because of the news that Chiliz – a blockchain provider based in Malta – has expanded its portfolio of partner companies across the country.
After initially announcing their intentions to invest $50 million to extend their company’s reach into the U.S. and open up a base in New York, they quickly followed that news up with a host of partnerships with some of the biggest franchises across the world of sport. The first notable addition to their stability in this country was tying up a deal with Kraft Sports and Entertainment. They own the six-time Super Bowl-winning franchise New England Patriots and New England Revolution of the MLS. Although the initial agreement only covers sponsorships and various other marketing activations, the company is trying to open the door to one of their most lucrative and popular offerings to supporters here in the U.S. too.
That was highlighted by comments upon the initial announcement of their diversification into U.S. sport from their chief executive Alexandre Dreyfus. He said that the U.S. market is a huge focal point for the company, and the investment is also being made ‘to launch fan tokens with the leading franchises from the five major U.S. sports leagues.’
So far, they’re being true to their word, as they’ve now signed similar agreements with many of the NBA and the NHL teams, although the fan token is yet to be seen. But what is a fan token, and who else has adopted them? The fan token sold under Chiliz’s fan engagement platform Socios.com are specifically club branded NFTs proving to be very popular, particularly in Europe with soccer fans. Paris St Germain in France was the first to take on the offer. Over in the Premier League, champions Manchester City led the way in the U.K. to bring the blockchain-based offering to the table. Their followers snapped them up; this was following a similar rush of sales in Italy where AC Milan raised over $6million within hours of their release.
While the clubs have raised some significant funds to help develop a new revenue stream, the purchasers of the digital tokens also get more than just a piece of memorabilia. The owners can use them as a means to access fan votes on club issues, as a key to opening the door to exclusive VIP experiences, exclusive merchandise, discounts, and more. This enhanced engagement with supporters is arguably attracting the fan as much as the potential of simply owning a ‘piece’ of digital memorabilia.
However, while the fan token isn’t currently on sale here, there has been progressing towards that in the future. Joe Tsai, the governor of the Brooklyn Nets, has admitted that NBA teams can issue fan tokens as discussions have taken place. So, for now, while fans across the U.S. can’t get their hands on the digital offerings available in Europe, it seems they won’t have to wait much longer.