Blockchain sports firm Chiliz to invest $50 million in U.S. expansion

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According to source Blockchain sports firm Chiliz to invest $50 million in U.S. expansion so lets continue.

MANCHESTER, England (Tech News Update) – Blockchain sports venture Chiliz, which is heavily involved in European soccer, will invest $50 million in an expansion to the United States, chief executive Alexandre Dreyus has told Tech News Update.

The company based in Malta offers tokens to fans which allow them to vote in a series of polls and receive special promotions and rewards, creating what it calls a “new digital revenue stream” for sports organisations through engagement with global fan bases.

The fan tokens are listed on Binance, one of the world’s biggest cryptocurrency exchanges, and last week Serie A club AC Milan became the latest team to launch their token, generating $6 million of revenue in the first day.

That move follows launches of tokens, on the company’s fan engagement platform Socios.com, for other high-profile clubs such as Juventus, Paris St Germain and Barcelona.

Cryptocurrencies and related tech have attracted a surge of interest in recent months, as mainstream investors and companies embrace bitcoin, the most popular digital token.

Dreyfus said his company is now opening an office in the U.S as they target the country’s top sports franchises.

“A huge focal point for us in our global growth plans is the U.S.. That’s why we’re opening a New York office and investing $50 million into the country’s sports industry in order to launch Fan Tokens with leading franchises from the five major U.S. sports leagues,” Dreyfus said.

“We head to the U.S. with a proven track record in generating millions of dollars of revenue for some of Europe’s biggest sporting organisations. In 2020, we shared more than $30 million with our partners, but this year we’re targeting a minimum of $60 million.”

Dreyfus said the FanMarketCap, a fan token price and market information tracker run by Chiliz, currently stands at just under $200 million and that he expects it to grow with the addition of new European soccer clubs in the coming weeks.

Chiliz are also in talks with Formula One and e-sports teams, he added.

PERFECT TIMING

Joseph Edwards, head of research at cryptocurrency brokerage Enigma Securities, said the timing is perfect for clubs, who need to boost revenue after the hits from COVID-19 related restrictions, given the current popularity of crypto markets.

“Fan tokens right now are just hitting the perfect itch at the perfect time – fans are disconnected physically from their fandom, and this helps bridge that gap,” he said.

“It should be said that Socios have usually been very clever with these launches – I can’t think of any that were headline failures, even in the overall crypto bear market – but there’s a reason that they’ve been stepping them up as of late.

“It just hits right in the current moment that sports entertainment finds itself in.”

Edwards said fan tokens were growing in popularity at the same time as a new type of digital asset – known as a non-fungible token (NFT) – has exploded in popularity during the pandemic as enthusiasts and investors scramble to spend enormous sums of money on items that only exist online.

Giorgio Ricci, Chief Revenue Officer at Italian champions Juventus, stressed that there is more to the tokens than just revenue generation however.

“(It) is not just a short-term fix to the problems brought on by the pandemic,” he said.

“It’s a solution to the longer-term issue of how to engage with the 99% of fans that aren’t able to watch games from the stadium or ever set foot in Turin.

“In normal circumstances our stadium holds 41,000 people, but recent estimates suggest our global fanbase is around 400 million, many of whom are thousands of miles away,” he added.

Writing by Simon Evans; Additional reporting by Tom Wilson in London; Editing by Ken Ferris

(This story has not been edited by Bollyinside staff and is auto-generated from a syndicated feed.)

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