As the Euro 2024 and Copa America tournaments approach, fan tokens are becoming the center of attention in the crypto world, reports Reuters. These digital assets, issued by national teams and clubs, offer fans profitable ways to interact with their favorite teams. Recent data shows significant growth in activity around these tokens, reflecting the growing interest in the upcoming football events.

Chiliz, the native cryptocurrency of the Socios blockchain, which hosts many fan tokens, has grown from $687 million at the beginning of the year to over $1.07 billion. According to CoinGecko, this surge brings it closer to the levels last seen during the 2022 FIFA World Cup. Trading volumes of fan tokens have also increased, reaching over $170 million in May compared to the range of $25 to $57 million in January, according to Kaiko data. The total market value of listed fan tokens is now around $413 million.

This summer could be decisive for the fan token sector, which remains relatively new. These tokens typically offer privileges such as participation in lotteries, early access to tickets, discounts on merchandise, and the ability to vote on minor team decisions, such as matchday songs. Supporters see these tokens as a rare example of real cryptocurrency utility, while critics argue that the speculative nature of these tradable assets may overshadow their intended purpose of engaging fans.

A Chiliz representative emphasized that the company's marketing materials clearly state that "fan tokens are fan engagement tools and should be used as such." For example, the price of Portugal's fan token has risen by about 2% over the past 30 days to $2.94, while Argentina's token briefly reached its highest level since 2022 at $2.46, though both remain below their peak 2022 FIFA World Cup values. Jag Kuner, head of derivatives at Bitfinex, noted that the recent increase in trading volumes might be temporary, pointing to a decline in activity after the World Cup.

During the previous crypto boom in 2021, many leading football teams and sports stars promoted crypto assets such as non-fungible tokens (NFTs) and fan tokens, which led to criticism. Last year, British lawmakers warned that the rise of NFTs in sports could create financial risks for fans and potentially damage the reputation of clubs. Similarly, the Football Supporters' Association of England and Wales criticized partnerships with fan tokens as attempts to monetize trivial matters or impose financial barriers on genuine fan engagement.

Adam McCarthy, an analyst at Kaiko, noted that changes in token volume and price do not always correspond to the team's performance. He stated that there is no clear evidence that holders benefit from owning these tokens as a form of investment in the team's success. Research analyzing fan token trading during major sporting events showed that it often follows a "buy the rumor, sell the news" pattern, with volumes and returns generally increasing before major tournaments and then declining as key matches begin.

However, another study found that fans who buy tokens typically benefit from the advantages offered through voting on club-related decisions. Lennart Ante, CEO of the Blockchain Research Lab, noted that when fans can influence club decisions, they engage more actively. He emphasized the dual nature of fan tokens as engagement tools and speculative assets, suggesting that the future of fan tokens may depend on the balance between engagement-oriented users and speculators.