Arsenal has been warned by Britain’s Advertising Standards Agency over its promotions for fan tokens.
Fan tokens allow holders to vote on decisions related to sports clubs and have become a new source of revenue. The tokens are traded on exchanges like other cryptocurrencies.
The advertising watchdog believes that Arsenal failed to illustrate the risks of the investment and took advantage of consumers’ inexperience with crypto-related assets.
A handful of European soccer clubs have generated more than $200 million in revenue using Socios, an online marketplace for fan tokens, according to the Telegraph.
Fan tokens have also garnered the attention of players.
- In August, Lionel Messi signed a two-year, $41 million deal with PSG, and a portion of his contract is being paid in fan tokens.
- PSG did not disclose how many tokens Messi received but told Reuters that the amount was “significant.”
Other Sports Embrace Tokens
UFC announced a plan in May to issue a blockchain-based token in coordination with Socios and Chiliz, a sports-focused token exchange.
Chiliz is investing $50 million to bring its unique sports team fan access system to the States and has secured partnerships with most major U.S. sports leagues, NASCAR, and esports teams.
The global fan token market cap has reached $413 million as of Wednesday.