The price of football fan tokens, which are designed to engage fans, appears to be influenced by the team’s on-pitch performance.
Argentina’s 2-1 defeat to Saudi Arabia in its FIFA World Cup opener has caused the price of the Argentine Football Association’s (ARG) Fan Tokens to plummet, in line with the hopes of the country’s die-hard fans.
Data shows that ARG Token opened at $7.21, and due to the poor performance of the team led by Lionel Messi, the token price fell 31% to $4.96 at the end of the game, and then rose to $5.22 at press time from Coiningecko.
In contrast, the floor price of “The Saudis,” a Saudi Arabia-themed collection of non-fungible tokens (NFTs) not related to the soccer team, rose 52.6% from 0.196 ETH to 0.3 ETH to 0.225 ETH, or about $250, over the same period before cooling off.
According to OpenSea data, the sales volume of this collection has also increased rapidly by 990% in the last 24 hours to 24.5 ETH.
Despite the growing hype surrounding the FIFA World Cup, which officially kicks off on November 20, cryptocurrency research firm Delphi Digital noted that the trading volume of its interactive platform Fans with Socios’ Chiliz native token (CHZ), which represents participating countries in addition to other football-based tokens, has also cooled significantly in recent days.
CHZ is an ERC-20 token derived from Socios, a blockchain-based fan engagement platform that is one of the biggest contributors to the sports fan token craze.
Many soccer-based tokens run on Socios, which has partnerships with some of the world’s biggest soccer clubs, including FC Barcelona, Paris Saint-Germain, and Manchester City. While the tokens do not represent ownership in the pool, in addition to allowing access to certain rewards, the tokens allow buyers to vote on some decisions made by the sponsored teams.
The popularity of fan-based tokens in the sports industry has also been volatile recently, with token sales typically growing by more than 250% per month since January 2022.
It seems that some see tokens as an indirect way to bet on the success of such teams, despite the fact that tokens are not designed for this purpose.
The token is also affected by factors beyond the football team’s on-field success, such as the frequent ups and downs of the cryptocurrency market and breaking news events.
An example is the recent FTX debacle which caused the CHZ price to drop by nearly 40% since reports of liquidity issues and bankruptcy proceedings at the exchange.
In May, smart contract platform Algorand became the first official blockchain-based sponsor of the FIFA World Cup, which ends on December 18.
