Chiliz CEO: How Fan Tokens Are Revolutionizing the Fan Experience

TL;DR

Chiliz fan tokens are fungible digital tokens that help sports teams engage and monetize the 99% of fans who are not in the stadium, city, or even the team’s country. Through Socios, token holders can vote on selected fan-engagement decisions and access other benefits. Chiliz reports partnerships with more than 120 sports properties and hundreds of millions of dollars in club revenue, making the details worth exploring.

Transcript

everything is transactional it's final engagement but it's transactional Alex good to see you my friend hi everyone how are you I'm good it's a crazy old world out there so and you know but that's the last time we spoke was almost exactly two years ago I believe two years ago and the world was quite different at that point was so simple it's never ... Read More

Key Insights

• Fan tokens are fungible tokens that offer fans a way to engage with their favorite sports teams, providing voting rights and other benefits.
• Chiliz and Socios have partnered with over 100 sports teams globally, including major football clubs like Barcelona and Juventus.
• The fan token model creates a new revenue stream for sports teams, especially beneficial during and after the COVID-19 pandemic.
• Despite challenges like crypto market volatility, the fan token ecosystem has proven to generate significant revenue for sports teams.
• Chiliz is launching a new blockchain to decentralize fan token utility, allowing developers to create new applications and services.
• The model focuses on engaging the 99% of fans who are not able to attend games in person, offering them ways to connect with their teams.
• Chiliz aims to protect the IP of sports teams while allowing for innovation through a curated governance model on their blockchain.
• The future of fan tokens may include expanded use cases like loyalty rewards, NFT integrations, and enhanced fan recognition systems.

Questions & Answers

Q: What are Chiliz fan tokens, and how do they improve the fan experience?

Fan tokens are fungible tokens designed as a type of membership program for sports supporters. They let holders vote on selected club decisions related to fan engagement, rather than business or sporting matters, and can provide other benefits.

Q: What is the difference between Chiliz and Socios?

Chiliz is the blockchain foundation and token behind the ecosystem. Socios is the consumer-facing product, launched in late 2019 or early 2020, through which fans use team fan tokens.

Q: Which sports teams work with Chiliz and Socios?

Chiliz began with Paris Saint-Germain and Juventus in 2018 and 2019. Its network later grew to more than 80 football teams, including Arsenal, Barcelona, Manchester City, and Inter Milan, and more than 120 sports properties overall.

Q: Why do sports clubs issue fan tokens?

Fan tokens give clubs a way to engage and monetize the 99% of supporters who are not in the stadium. This includes fans who live outside the club’s city or even outside its country.

Q: How do fan tokens generate revenue for sports teams?

Chiliz initially offered clubs a minimum guarantee, comparable to the guarantees used in merchandise agreements, to issue and sell tokens. By early to mid-2022, the model had generated hundreds of millions of dollars in revenue for participating clubs, both during and after COVID.

Q: What voting rights do fan-token holders receive?

Token holders can vote on certain club decisions centered on fan engagement. The decisions are explicitly positioned between business and sporting matters, rather than giving fans control over either area.

Q: How has the crypto market affected Chiliz fan tokens?

Chiliz said fan tokens remained dependent on the broader crypto market because they are digital assets that are traded and available in that market. As a result, the business experienced pressures similar to those affecting other digital-asset entities in 2022.

Q: How were fan tokens used during the Italian Super Cup?

At the Italian Super Cup match between AC Milan and Inter Milan in Saudi Arabia, holders of either team’s token could bid at auction on balls associated with goals scored in the game. Each ball was removed from the field, fitted with an NFC chip, boxed, filmed, and given metadata such as the scorer and a video link to the goal.

Summary & Key Takeaways

• Chiliz and Socios are pioneering the fan token economy, offering sports fans new ways to engage with their favorite teams through fungible tokens. These tokens provide fans with voting rights and other benefits, creating a new revenue stream for sports teams.

• The fan token model has proven successful, generating hundreds of millions in revenue for partnered sports teams. Despite challenges like crypto market volatility, Chiliz continues to innovate, launching a new blockchain to decentralize fan token utility.

• Chiliz's mission focuses on engaging the global fan base, particularly the 99% who cannot attend games in person. The future of fan tokens includes expanded use cases and partnerships, enhancing fan engagement and creating new opportunities for developers.