Imagine Your Favorite Sports Team Would be… YOUR Team
There’s a way to own a piece of your favorite sports team and all you have to know is in this article
Who should become the team’s next manager? What should next season’s jersey look like? Imagine you could impact your favorite sports team’s decisions and your voice was heard and considered.
Imagine you could share victories with your favorite team — not just emotionally, but also financially. You’d be able to participate in the monetary success in the same way currently reserved to large investors and stakeholders.
Imagine the fan experience would truly match the level of innovation the sports business demonstrates in other areas like game analytics. You’d have an entirely new experience when watching the game from your couch or the bleachers.
All of this could happen sooner than later, thanks to tokenization.
Wait, token — what?
Tokens — Digital Pieces of an Organization
Tokenization is a fairly new and hot topic in many industries. It describes the process of representing an asset or a right as a unique digital item.
An asset in this context could be a unit of a currency, say one Dollar. It could also be a share of a company or real estate object — or it could be a digital membership of your favorite sports team. This digital membership can come with different rights.
Tokens are a tool that can be used in many different ways. The examples mentioned in the introduction can be broken down into three dimensions:
- Participation & Influence
- Sharing Success
- Fan Experience
Participation & Influence
An organization issuing a token can tie ownership to the right to participate in its governance. Just like shareholders are entitled to vote on certain decisions of the company they are invested in, fans could be entitled to vote on certain matters of their favorite sports team if they’d own its token.
For a sports team, this can mean anything from binding votings on the next jersey design, to non-binding votings on who should be the next coach.
Paris Saint-Germain, Atlético Madrid, and Juventus Turin are among the teams that launched a governance token this season.
Sharing Success
You can think of different models where a token represents the right to participate in the profits or revenues an organization has. Depending on the country you live in, a wide range of financial instruments can be mirrored with tokens.
A sports team token could, for instance, represent the right to participate in future broadcasting revenues or sponsoring deals. When a team is financially successful, its token-holders would be entitled to a piece of the pie.
In the broad scheme of things, tokens enable clubs to do a novel form of “betting” on their performance, not solely based on success on the court, but also in the books.
Brooklyn Nets point guard Spencer Dinwiddie launched a fan token this January. Due to pressure from the NBA, he had to disregard the initial plan of letting his investors participate in future successes (namely parts of the proceeds from his next contract) but the idea is likely to be picked up by other athletes soon.
Fan Experience
Tokens are especially interesting in areas where middlemen make simple processes complex. Cryptocurrencies can be understood as tokens and they allow their users to send money from peer-to-peer, without involving payment providers like PayPal or banks.
One area where tokens can add value for the fan is ticketing. With token-based tickets, a fair secondary market can be established. All rules for reselling tickets are automatically enforced and counterfeit tickets simply do not exist.
The Royal Durch Football Association tested a token-based ticketing system at the Euro cup qualifier game between the Netherlands and Estonia in late 2019.
Want to Learn more about Tokenization in Sports?
We at Liquiditeam are dedicated not only to providing solutions around tokenization in professional sports but also to educate on the topic.
We have a webinar and workshop offering available in English and German and in our publication, we write about the different use cases of tokenization in sports and their respective benefits frequently.
Our recent insights on sports tokenization:
About Liquiditeam
At Liquiditeam, we develop token-based financing and fan engagement solutions for professional sports clubs and athletes. If you want to learn more, subscribe to our newsletter, send us an email to hello@liquidi.team, or follow us on Twitter.
Liquiditeam is an Untitled INC venture.
