Is it time to ban football fan tokens?

Football fan tokens from Spain and Argentina have seen their value plummet in recent times despite both teams winning major tournaments, with many of the top tokens down more than 90% from their all-time highs.

If a club wins a major tournament, you can expect their fan token to skyrocket.

But Spain discovered that this was not always the case after they crushed England to win the 2024 European Championship.

Ahead of the grand final, Spain’s National Football Token (SNFT) had risen to as high as $0.039, bringing hopes of making history.

However, there was a dramatic 43.5% drop in the following three days, and the token is currently down to $0.022.

SNFT in the last seven days | Source: CoinMarketCap

When you walk away, things get worse.

The all-time high for the SNFT was $0.8633, a record set in September 2022, according to figures from CoinMarketCap.

It lost 97.4% of its value in less than two weeks.

SNFT value since launch | Source: CoinMarketCap

This token was an official initiative on behalf of the Royal Spanish Football Federation, and they stated that they wanted to be one of the first national teams to jump on this train.

But first of all, you could argue that teams launching their own cryptocurrencies does nothing but cause financial harm to fans.

Each of the five largest football fan groups, led by Paris Saint-Germain, FC Barcelona and Manchester City, has suffered sickening losses in value in recent years.

PSG is trading at $2.83 at the time of writing, down 95.4% from its all-time high of $61.23 set in August 2021. BAR has lost 97.5% of its value over the past three years. Meanwhile, CITY is down 93.7%.

Each launch is usually accompanied by high-profile, splashy endorsements from football stars that fans adore. And when Lionel Messi made his big-money move to PSG, part of his fee was paid for in fan tokens.

Argentina’s official fan emblem suffered a similar fate, however, as Argentina beat Colombia 1-0 in the Copa América final.

ARG had recovered well before that crucial match, but in a week, it fell by almost 50%.

ARG price last week | Source: CoinMarketCap Football and crypto intertwined

The ties that connect cryptocurrency companies and football clubs have been growing in recent years.

Although there was a bit of a lull during the bear market, exchanges are once again signing big-money partnerships to educate sports fans about cryptocurrency.

Kraken announced this week that it will become the “Official Crypto and Web3 Partner” of Tottenham Hotspur — building on a recent deal with Atletico Madrid. Its logo will also appear on the club’s jersey sleeves. The exchange’s UK managing director Bivu Das said:

“Crypto already has mainstream name recognition in the UK. Our research shows that crypto is more popular than many traditional financial services products. Partnering with Tottenham is about taking this technology a step further and closing the knowledge gaps that prevent some football fans from joining the crypto ecosystem.”

Bivu Das

While club sponsorships have nothing to do with fan tokens, some critics are concerned about the trend of crypto companies sponsoring football clubs, mainly because the volatility of digital assets makes them akin to gambling.

Source: Kraken UK is not a fan of fan tokens

In a report published last October, a group of British politicians went so far as to say that football clubs should be stopped from offering fan tokens altogether. The chair of the Culture, Media and Sport Committee — Dame Caroline Dinenage — said:

“In the world of sports, clubs are promoting volatile crypto asset schemes to extract additional money from their loyal fans, promising perks and privileges that often fail to materialize.”

Lady Caroline Dinage

He noted that groups representing football fans have expressed concerns about these digital assets, primarily because they only allow fans to vote on arbitrary things, such as the songs played after a goal is scored.

Companies issuing fan tokens were defensive at the time, with Socios arguing to British media outlet Sky News that they were a valuable tool for fan engagement.

“Fan token holders received over 24,000 matchday tickets and over 1,000 items of merchandise last season and continue to engage with their clubs in a unique new way.”

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