The cryptocurrency market has been hit by a massive selloff this year. While a wide number of crypto businesses have faced challenges amid the cryptocurrency winter, the sports fan token industry seems to have displayed some resiliency. For instance, Chiliz has boosted its staff personnel by more than 70% this year as the company proceeded to expand its global presence in the year.
Chiliz’s hiring spree is a reflection of an expanding move of blockchain into sports. Data from the industry data aggregator CryptoSlam shows that since early 2022, monthly volumes for global fan token sales have increased by nearly 200%, reaching about $6.4 billion in September. At the start of the year, this was just about $2.2 billion.
Bands, sports teams, and other organizations can benefit from fan tokens, a sort of cryptocurrency. Numerous sports organizations, including FC Barcelona, Juventus, Paris Saint-Germain, and others, have to fan token collaborations with the Chiliz platform and the fan engagement website Socios.com.
To boost fan participation through collectibles and voting systems, fan tokens and NFTs were initially presented to the sports sector. While the sales volumes of fan tokens have increased, the trend for nonfungible tokens (NFTs) has been exactly the opposite, according to statistics from CryptoSlam. From $4.8 billion in January to $550 million in September 2022, monthly global NFT sales volumes decreased by 88%, while trading volumes fell 98% since the start of the year.
According to Socios.com CEO, Alexandre Dreyfus, scalability may be one of the factors contributing to the success of the fan token sector. The only digital asset that can economically provide the scalability to let millions of users access these networks is fan tokens, according to him.
In its research outlining upcoming trends in the sports sector, management consulting company Deloitte predicts a surge in blockchain-enabled innovations in the future, with the consequence that “the use of NFTs, crypto, fan tokens, and ticket innovations will grow and adapt.”
Deloitte predicts that the sports sector will soon begin using the blockchain to connect fans with season tickets as it moves beyond NFTs. Associating game tickets with NFTs as a way to reward fans would be the first step toward achieving this goal, but advances in smart contracting may lead to the emergence of additional use cases.
Confirming the findings of Deloitte’s analysis on the expanding NFT trend in the sports sector. Basketball Forever, an Australian media firm, recently unveiled Hoop Hounds, an NFT project designed to boost National Basketball Association (NBA) fan engagement and offer the tokens significant real-world utility.
Exposure to the sports stock market such as those offered by sportiqo.com, a platform where sports fans can trade the performance of their favorite players like trading stocks continue to be another catchy trend even if fan tokens have recently gained popularity. Web3 has become a force and a farce at the same time. There is no denying the potential of blockchain-based technology, and large businesses are already based on them, some of them explicitly in the sports industry.
The potential of blockchain technologies centered on NFTs for items such as loyalty rewards, ticketing, and even media rights and licensing is replacing the speculative nature of cryptocurrencies in sports technology.
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