Cryptocurrency has been steadily making its way from a niche investment to a genuine contender as an alternative form of payment. Still viewed as quirky and complicated by some, cryptocurrency has some way to go until it becomes universally accepted, but interest in the possibilities is rocketing.
Sport was one of the obvious avenues for cryptocurrencies to pursue, following its emergence on the casino scene. But as well as being able to bet using cryptocurrency, you can now make regular purchases in some places because crypto is increasingly being accepted as payment.
Here’s a closer look at the role of cryptocurrency in European sport and what the future could hold.
Official Partnership
There’s often references to crypto creeping into the collective consciousness, being introduced surreptitiously as a possible option for payment.
Nothing could be further from the truth; many agencies openly promote or offer crypto to customers who want to use it.
Football in particular has embraced the use of cryptocurrency within the sport, with a number of clubs signing up for sponsorship. In February, Rangers announced they would be sponsored by a Turkish crypto training platform in a deal that’s due to run until the end of the 2022/2023 season.
Betting firms were among the first to allow customers to place bets using crypto but this has evolved into using the currency to pay for tickets.
A recent collaboration between UEFA, FIFA and AlphaWallet has meant that it’s now possible to buy tickets for the Euro 2020 fixtures using an Ethereum account. If only a small percentage of fans choose to use Ethereum to purchase tickets for this summer’s event, it will still be the most significant mass use of cryptocurrency seen to date.
Understanding Cryptocurrency
Although its use is far more prevalent than in the past, cryptocurrency remains a mystery for any that don’t use it.
The important thing to remember is that there’s no single cryptocurrency; more than 6700 were being traded publicly at the last count. And new cryptocurrencies are appearing all of the time, so it’s essential to stick to the right one.
Unlike traditional currency, cryptocurrency is a purely digital method of payment. It can be used online to buy and trade items but you’ll never be holding a pile of cryptocurrency in your hands, as it doesn’t exist in real life.
One of the appealing factors of cryptocurrency is that it’s not controlled by any of the main banks in the world. This means the real value of it can’t be managed via mechanisms such as inflation.
People can opt to speculate on the value of cryptocurrency, a market which has the potential for great returns but offers very high levels of volatility. This means the value of your crypto can be wiped off or plunge very suddenly.
But speculating on the price was just the early days of crypto; it’s now being increasingly used as a valid means of payment. Different organisations from a wide variety of industries are now adopting the technology – including the world of sport.
Uses Within Sport
As seen above, it’s possible to buy tickets for the Euro 2020 Finals by using your crypto account, but there have been many other cryptocurrency transactions which have also been completed.
These include:
- In 2018 Gibraltar United FC said players would be paid in cryptocurrency (QTC)
- A crypto venture based on QTC (quatocoin) bought a 25% share in Serie D club Rimini FC using only cryptocurrency
- FIFA and UEFA plan to make it possible to use crypto at all future major events
- In April 2021, Southampton FC revealed that players’ bonuses could be paid in bitcoin due to a new sponsorship deal
- Online sales of football merchandise at clubs signed up to crypto sponsorship, such as Watford
- The first purchase of a footballer using crypto (the sale of ex-Real Madrid striker David Barral to DUX Internacional de Madrid)
- The use of Fan Tokens in clubs such as PSG, Barcelona and Juventus.
Fan Tokens are a new concept in football but they’re similar to an Initial Coin Offering, with a limited number available for fans to buy or hunt down. The owner of Fan Tokens has the right to vote and influence the club – and the club has the legal responsibility to honour the actions. However, clubs won’t allow these Fan Tokens to be used in ways which could make sweeping changes; at best, they’re a way for fans to feel involved and increase engagement.
The Benefits of Using Cryptocurrency
Cryptocurrency is not yet available universally within sport, but there is a growing appetite to explore the different ways it could be used. It may seem pointless when traditional payment methods are still available, but crypto offers certain advantages.
Good investment
Although crypto is notably volatile, it’s a market which is expected to rise in the longer term. The increasing use of crypto and the move to a more mainstream position means that although there may be dips along the way, the overall trend should be upwards. For sports which have a solid crypto portfolio, this offers a way of accessing high returns which are likely to be greatly beyond anything which could be possible with other investment opportunities.
Easy international transactions
Within many sports, including football, players move all around the world and often play in a different country or league. This can present difficulties with currency exchange rates and complicate banking arrangements. Using crypto means that everyone is on the same system, with no need to convert currencies or go through complex external verification.
Security
As crypto is outside the security of the main banking system, security is of paramount importance. This same secure system can be used as a way of combating fraud and counterfeit goods, preventing fans from being ripped off with fake tickets or merchandise.
Smart contracts
Player contracts and analytics are highly confidential but using blockchain technology could make the process easier. So-called smart contracts could be stored digitally within the crypto system, making it simpler for players to change clubs and analytics on their performance to be quickly shared.
Of course there remains a way to go before crypto is fully embedded in sport but the advantages it potentially offers means it’s an exciting option that’s worth pursuing further.
