Cryptoassets and Sports

In this article, we will focus on some aspects related to sports, mainly football, and will aim to shine some light on cryptoassets. It is very well known that many sports stars now elect to be partially paid in cryptocurrencies (especially in the NBA and NFL) and that Messi received PSG Fan Token as part of his new contract.

Besides the great marketing move behind Messi’s contract (resulting in PSG token prices going up and providing many benefits to the club, including absorbing costs with a “currency” issued by themselves), this initiative is likely to be replicated by other clubs. There is an increasing number of teams that use these Fan Token platforms to allow their fans to buy these tokens in exchange for future benefits in the purchase of jerseys, tickets, events, and all sorts of merchandising goods or storage purposes. The main start-ups behind this initiative are Chiliz, Socios.com (further information to follow) and Sorare.

Sorare has a “twist” as it allows the possibility to play fantasy football with virtual exchangeable cards. Some of these cards are “unique” (NFT, with sales in 2021 estimated to be USD 150 million) with great benefits for platform competition.  This initiative has such potential that it raised funding led by Softbank of USD 680 million with investments made by popular stars such as Azpilicueta, Piqué, Ferdinand, Schurrle and Griezmann, as reported by Palco23.

Going back to real sports, Inter Miami (co-owned by David Beckham) partnered with a cryptocurrencies start-up as main sponsor, as reported by Marketing Registrado.

Gonzalo Higuaín’s team jerseys will don the XBTO logo and other jersey partnerships were closed.

In the article the club’s CEO Jorge Mas Canosa said:

“XBTO will be fully integrated across Inter Miami’s platforms beyond the jersey. Together we will raise awareness and build credibility, and further accelerate the social benefits of cryptocurrency through strategic initiatives as XBTO continues to redefine the next era of finance.”

In Europe, the PSV (first division team of the Dutch League) has announced that part of its value reserve is held in Bitcoin as well as its partnership with Anycoin Direct in a two-season deal. As reported by BitCoin Magazine, the total sponsorship amount was paid in BTC and the club said that they consider cryptocurrencies as the best-performing asset long-term. Considering this club was founded 108 years ago, it is quite an innovative move.

Closer to Argentina, the traditional Brazilian team, Flamengo, has also launched its own fan token. As reported in this article, Atlético Mineiro and Corinthians are in the digital market as well. The Flamengo estimates a profit of R$ 145 million until 2025.

Locally, there are several teams involved with this innovative technology. From Club Atlético Independiente launching its fan token ($CAI, read release) and the rumours of the Argentine Selection launching its own token ($ARG) through Huracán (that partnered with an exchange as main sponsor intending to pay part of their players’ salaries in cryptocurrencies, as reported by BAE Negocios). DeCrypto partnership with the “Baloon” (as Huracán is known) is an ambitious alliance that includes to carry the logo stamp on the front of the club’s jerseys, in the stadium’s notice board, social headquarters and in the sports field, allowing players and employees to collect their salaries in digital assets and offering training courses to those fans eager to learn about crypto-assets; with even social contributions being paid in cryptocurrencies.

It is an ambitious project that aims to increase the amount of people who are adopting cryptocurrencies as capital safeguard and/or as a means of payment. In this sense, the spirit of cryptoassets fintechs is “to bake a bigger cake” rather than “to hold a bigger portion”. The low marketing budgets managed by traditional sponsors such as banks or well-known brands are beneficial for fintechs that manage bigger capital amounts.

But Huracán is not the only club favouring crypto: Deportivo Español de Buenos Aires (currently in First Division C of the Argentine League and close to bankruptcy) started paying part of their players’ salaries (bonds) in a lesser known crypto: Zoe Cash (leveraged in gold according to its developers). This initiative, as informed by the media iProUp and Infobae, reveals that the crypto revolution is open to small and large institutions; even Club Leandro N. Alem (fourth division) was the first to adopt crypto for payment of salaries (USDT) and is seeking blockchain-technology sponsorship. These tools are helpful for talent retention and beneficial for local clubs unable to pay salaries in dollars or likewise in foreign currency.

To conclude, I’d like to point out that the current crypto boom is open to anyone deciding to endorse it and with a suitable instrumentation team, there is no need for large infrastructure or big cap amounts. These technologies offer the biggest potential gains, and their mass adoption will generate huge returns in a more transparent and safe way in the future market ahead.

Diego J. Nunes is a Partner at Estudio Nunes & Asoc and a member of AGA's Cryptocurrency Global Practice Group. 

Related Reading:

• The nature of cryptocurrencies within the Argentine legal framework
• Digital signatures: which are legally binding and which are not?

About Estudio Nunes & Asociados:

A full service law firm, Estudio Nunes & Asociados Abogados was founded in 1981 by Dr. Sergio Héctor Nunes and specialises in offering corporate, commercial, civil, labour and administrative legal advice.

We strive to offer comprehensive legal consulting to our clients, companies and individuals, providing technical professional and innovative solutions, all tailor made to the needs of each client's complex requirements.

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