20 June

|

2:13 AM UTC
20 June

|

2:13 AM

What are Fan Tokens? Analysis of Fan Token Trends in This Year’s World Cup

The 2022 World Cup will officially begin on November 20. This is the time for the world of Fan Tokens to rise because investors will buy tokens from their favorite teams. With the approaching event, Fan Tokens are growing in sales faster than other cryptocurrencies. In early 2022, while the prices of Bitcoin and other top coins were 50% down from their peaks, that of Fan Token dropped by 30%, and some Fan Token prices also tended to increase.

What are Fan Tokens?

Fan Tokens are a type of Social Tokens, designed to serve artists and sports teams that own a certain number of fans. Currently in the crypto market, the majority of Fan Tokens are issued by sports teams, mostly football, basketball, rugby, etc.

Today, Jade Forest Capital will focus on Fan Tokens for football clubs and their use cases. Each token has a different use case. The tokens with many use cases are more sought after, which also depends on the football club and the issuer. For example,  ARG is the Fan Token of the Argentina national football team, and CITY is the Fan Token of the Manchester City team.

Values and use cases of Fan Tokens

Fan tokens are a form of cryptocurrency that gives holders access to a variety of fan-related membership perks like voting on club decisions, rewards, merchandise designs and other unique experiences. Holders with a certain amount of Fan Tokens will hold a specified set of privileges.

Fan Tokens also allow their holders to feel engaged with their favorite teams and clubs, bringing spiritual and symbolic values. However, Fan Tokens still have limited use cases. Socios – the biggest issuer of Fan Tokens in the market suggests several use cases of this type of cryptocurrency:

  • Users participating in programs organized by sports clubs will have the opportunity to receive rewards.
  • When actively interacting through the app, users will accumulate SSU – a token for loyal users that can be used as currency for exchange in the app.
  • Users can exchange tokens for club memorabilia and use them to participate in football games, meetings, events, etc.
  • Token holders can also recommend songs of victory, choose a message for the locker room, change the design of the team bus, etc.

How to buy Fan tokens:

Before getting to the point, let’s find out what Chilliz is.

Chiliz describes itself as “the world’s leading blockchain fintech provider for sports and entertainment”. Chiliz (CHZ) is the most popular fan token platform to date and it has its own blockchain. Chiliz also developed the Socios.com platform for fans to engage with their favorite teams and clubs.

The Chiliz ecosystem is on the rise. Currently, more than 150 Fan Tokens are issued by Chiliz, doubling the figure of 2021 with more than 70 Fan Tokens. Within nine months, there were more than 80 Fan Tokens created by Chiliz (an average of 10 Fan Tokens/month), showing that Chiliz and Socios are accelerating their development to grab more Fan Token market share.

You can buy Fan Tokens on the Chiliz network or major exchanges including Binance, Coinbase Pro, Huobi Global, KuCoin, and Bithumb. In addition, decentralized exchanges (DEXs) such as PancakeSwap also sell Fan Tokens, but be careful with those DEXs because a lot of Fan Token scams may appear. You need to consider carefully before investing.

Top five Fan Tokens by market capitalization (according to CoinmarketCap)

1. Santos FC (SANTOS)

Currently, the SANTOS token is trading at around $14 after a major uptrend from a previous range of $5 almost a week ago. The token is available for trade on exchanges like Binance, Gate.io, Lbank, PancakeSwap etc.

2 SS Lazio (LAZIO)

 At the time of writing, LAZIO is trading around $5.8 and is available on Binance, PancakeSwap, MEXC, Gate.io etc.

3. Porto FC (PORTO)

With a current price of around $5.13, PORTO is available for trading on Binance, Gate.io, MEXC, LATOKEN etc.

4. Paris Saint-Germain (PSG)

The PSG token is currently worth $8.16 and has a market cap of around $25 million. Currently, the token is traded on leading crypto exchanges such as Binance, XT.COM, BingX, MEXC and Bybit.

5. FC Barcelona (BAR) 

At the time of writing, the BAR fan token is trading at around $5.79 and is available on Binance, Bybit, CoinW, Bitget, and FTX.

Development potential of Fan Token

The 2022 World Cup is approaching, but there are only two Fan Token projects, ARG and POR, on the market while there are 32 teams participating in the competition. Therefore, more national team Fan Tokens may be launched in the future to serve the needs of fans.

Should I buy Fan Tokens?

The crypto market has always been considered high risk because of its volatility and Fan Tokens are one of the highly volatile crypto coins. However, the risk of volatility can be rewarded with high returns as some Fan Token prices can skyrocket once they become popular.

Before making any investment, you should consider carefully and be prepared for worst-case scenarios. Please note that this blog is not giving investment advice but for academic purposes.

Jade Forest Capital has shared with you an overview of Fan Tokens. We hope this information will help you make wiser decisions on your investment.

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