Blockchain + Football: On the Green Field, Is It Grass or Chives?

This article was published on DappReview, authored by DR Partner.

Football is undoubtedly the most valuable, widely followed, and influential sport in the world. No religion has a distribution range or number of believers that can match football. Recently, blockchain has been making waves in football, with some blockchain projects partnering with European football giants, helping clubs issue tokens, creating NFT collectible cards for players, and granting voting rights to fans… This has successfully attracted the attention of DappReview's old and new football fans. We tried out two football DApps, and blockchain has indeed given football fans a dream of becoming football managers, though for now, it remains just a dream.

Fans are referred to as the "twelfth man" on the football field, and some clubs often emphasize that fans are the true owners of the team. Unfortunately, these "owners" are merely nominal; they cannot decide on the team's signings for the next season, have no say in the team's jersey style, and even what merchandise the team produces is beyond their control.

How can we truly empower fans to take charge? Some internationally renowned football clubs see possibilities on the blockchain. Recently, FC Barcelona announced a partnership with the blockchain sports entertainment fan interaction platform ChiliZ to launch the Barça Fan Token ($BAR), allowing the 300 million Barça fans worldwide to participate directly in club decision-making through token ownership.

Prior to this, six clubs, including Juventus, Paris Saint-Germain, and Atlético Madrid, had already partnered with ChiliZ. What kind of company is ChiliZ that has managed to secure deals with champions from La Liga, Serie A, Ligue 1, and the Turkish Super League? Are fan tokens a groundbreaking innovation or just a gimmick? Let's take a look.

The Powerhouse ChiliZ

Friends who follow the blockchain application industry may be familiar with ChiliZ. Back in June 2018, Binance invested in this blockchain-based sports competition platform. This introduced many to this blockchain project from Malta. The team, with a background in the online betting industry, made a high-profile entry into the sports sector in the second half of 2018, announcing the establishment of a blockchain-based fan interaction system called Socios.com, where fans can purchase the native token Chiliz and use it to buy fan tokens.

Fan tokens are issued in limited quantities. For example, FC Barcelona will provide 40 million Barça fan tokens (named $BAR), each valued at 2 euros. Fans who own tokens can vote on matters such as the team's jersey color, stadium music and logo, friendly matches, and charity lineups.

Voting is binding, meaning the club must implement the voting results. Therefore, if fans vote to change their jersey color, the club will have to honor that commitment. Since voting occurs on a blockchain platform, it cannot be tampered with or deleted—fans are a source of income for the club, and no team would offend them over such matters.

In January of this year, fans of Juventus, the club where football superstar Cristiano Ronaldo plays, used the Socios platform to vote on the song played when the team scores at home. This was the first vote on the platform, and fans chose "Song 2" by the British band Blur to be played during home goals.

Clubs can directly raise funds from fans, gain most of the revenue without giving up any equity, and without touching the interests of existing shareholders. Fans who spend money can also enjoy the thrill of participating in decision-making. Why not? In September 2018, the French giant Paris Saint-Germain, boasting stars like Neymar and Mbappé, was the first to partner with Socios, followed by Serie A champion Juventus with superstar Cristiano Ronaldo, and then the first Premier League club to sign, West Ham United… With the recent addition of Barcelona, fans can now see seven of the world's top football clubs on the Socios App.

Even the Smallest Matters Should Be Decided by Fans

We tried to purchase a fan token on Socios.com and found that the app is very friendly to Chinese users, even supporting Simplified Chinese. The main interface has five tabs: "Home," "Wallet," "Hunt," "News," and "More." Among them, "Hunt" is an AR game similar to "Pokemon Go," where Socios.com will access the player's location, allowing players to collect free $CHZ and fan tokens daily.

We found that currently, only five clubs are issuing tokens, with Juventus, Paris Saint-Germain, Atlético Madrid, and Roma's fan tokens each valued at 2 euros, while Turkish powerhouse Galatasaray's token is more affordable at just 1.5 euros, as they are not from the top five leagues. The token issuance for Barcelona and West Ham United still awaits official notification.

Currently, one $CHZ is approximately 0.09 RMB. In the "Daily Hunt" section of the "Hunt" interface, players can collect 3 $CHZ daily, worth about 0.27 RMB. From the map, these three $CHZ are scattered across three neighborhoods around me, and given the current pandemic situation, I certainly can't get them without a pass.

Don't think you can get $CHZ for free through hunting. To own $CHZ, you still have to spend money. In the Sorare wallet interface, there are two ways to top up: you can buy $CHZ from other trading platforms and transfer it to the Ethereum address in the app, or you can use a credit card to purchase directly within the app. Essentially, the app is still a centralized wallet, and the fan tokens you buy only exist within the app, not in your own Ethereum wallet. However, to some extent, this centralized approach is easier for fans outside the crypto circle to grasp.

After topping up the app wallet address with $CHZ worth 2 euros, I tried clicking "Get Fan Token," and I could obtain my first fan token. Coincidentally, Juventus is currently conducting a second round of voting, asking fans what features they would like to see added to the Juventus app: food delivery to the stands, augmented reality, quiz games, and payment functions. Each person can use up to 200 tokens to vote, and as the voting progresses, we see that fans' biggest demand is to add payment functionality.

Let's take a look at what other clubs have "big matters" for fans to decide: Paris Saint-Germain is seeking fan input on what information to include in the captain's armband, Atlético Madrid hopes to help striker Morata choose a teammate for a photoshoot, and Galatasaray is struggling to decide on the team's entrance music… After seeing these clubs' voting activities, one might wonder how trivial these matters are; couldn't they just initiate a Twitter poll?

Socios: The Old Membership System

Although most current votes are somewhat trivial, these limited-edition fan tokens are indeed enticing. However, we hope that fan tokens can truly belong to the fans, rather than being hoarded by old investors. Interestingly, the name Socios.com is derived from the term used by two traditional powerhouses in La Liga—Real Madrid and Barcelona—for their members.

Real Madrid and Barcelona are among the few membership-based clubs in the world, and their members are also called "Socios," a Spanish term meaning "partners." Want to become a member? You must pay. The adult membership fee for Real Madrid in 2018 was 145.49 euros (free after paying for 50 consecutive years), while Barcelona's adult membership fee in 2018 was 180 euros. Therefore, these two clubs earn about 10 to 20 million euros annually from membership fees.

But money isn't everything; becoming a Socios of Real Madrid or Barcelona is perhaps one of the hardest qualifications to obtain in the world. Both clubs currently have a strict rule for new adult members: they must be direct relatives of existing adult members. Only if this condition is met can you enter the candidate list for Socios, and then you must wait in line.

Socios.com effectively broadens the membership qualification to a global scale. Fan token holders cannot, like true Socios, run for the member representative committee or vote for the club president, nor can they self-nominate for the presidency. Otherwise, with the voting level of Chinese fans, they might easily elect two Chinese presidents for the La Liga giants. However, this does not prevent Chinese fan token holders from adding some Chinese elements to the loudspeakers at the Bernabéu and Camp Nou, perhaps even arranging some square dance hits.

In fact, the origin of modern football is precisely the membership system like Socios, where a few friends who love to play football pool some money together, which counts as membership fees, and then vote to elect a leader to form a small team. As more teams emerged, football gradually became industrialized, with large amounts of money, interests, and social resources invested, leading most membership-based clubs to be replaced by shareholding clubs, and the sense of belonging for fans in club affairs has diminished.

The open, transparent, and tamper-proof characteristics of blockchain can allow the membership system to regain its advantages, ensuring that the voting rights of the vast number of token-holding fans are protected, returning the team to the fans. Given time, the dream of everyone becoming a football manager may not be far off. For clubs, combining membership qualifications with blockchain can also serve as an efficient brand promotion strategy, deepening interaction with fans while enhancing the club's global influence.

In addition to issuing blockchain fan tokens, clubs are also seeking deeper interaction with fans through blockchain football games.

Sorare: A Football "Game" of Idle Play

Compared to the elite route taken by ChiliZ, Sorare firmly believes that "a spark can start a prairie fire," and has already partnered with 38 football clubs. Most of these clubs are from outside the top five leagues, but there are also giants like Juventus and Atlético Madrid among them. Juventus joined just this February, and Sorare's official Twitter showcased a rare card of Cristiano Ronaldo on the same day.

However, as a 20-year veteran fan entering Sorare with excitement, I find it hard to admit that this is a game. The player cards in the game are NFTs, categorized by rarity into unique, super rare, and rare. The game interface has five slots corresponding to midfielders, forwards, defenders, goalkeepers, and substitutes. This is puzzling; isn't a football match supposed to have 11 starters? Am I playing five-a-side football?

According to the rules, I can choose 5 cards from 15 rare cards to form my starting lineup. However, selecting 5 players from a bunch of unfamiliar names relies solely on gut feeling. When I finally gather my carefully chosen players, hoping to enjoy a pure football match, I realize I was mistaken; after everyone "reveals" their cards, they can all go back to their respective homes.

Did you notice? This is actually an "idle" game. After placing the player cards in their respective slots, no further actions are required; we just wait for the match results. The key point is that the so-called match results refer to the individual performances of the five members in real matches.

The specific evaluation metrics include match duration, goals, assists, shots, passes, saves, tackles, and other professional indicators. These metrics are multiplied by corresponding coefficients and summed to get the player's total score. If a player receives a red or yellow card, there will be corresponding penalties. All this data is pulled from football statistics websites. For example, if a forward plays for 80 minutes, has 2 shots on target, and completes 5 passes, the score would be 80 x 0.02 + 2 x 2.00 + 5 x 0.03 = 5.75. If he receives a red card in the 81st minute, the score would be 5.75 - 5 = 0.75, and the total score of the five players will be the team's score, competing in the weekly league.

After reviewing the match rules, I suddenly realized that I had been too casual when selecting players. The few young talents I gathered probably wouldn't even get to play in their respective clubs. A week later, the team's score was pitifully low. Since new players mostly receive cards of players from obscure clubs they've never heard of, who would be motivated to follow matches from leagues they can't even watch?

In the recruitment section of Sorare's official website, I discovered that this team from Paris only has three members and is urgently hiring developers and game designers. Seeing this, veteran fans sigh; we are still far from a playable blockchain football game.

Sorare Game Address

Conclusion

It's not just football that is embracing blockchain; we can also see the shadow of blockchain in basketball, rugby, and other sports. In addition to the tokenization of membership IDs, some sports organizations have also experimented with crypto collectibles, ticketing on the blockchain, and cryptocurrency payments. If a reasonable demand can be found in the vast sports market, acquiring a large user base will be just around the corner.

The strong purchasing power of sports fans is enough to excite the entire crypto market. Using sports as a medium to help more people transition from sports fans to crypto asset holders will be a welcome change for everyone.