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Democratising Football using Cryptocurrencies and NFTs

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Just over a year ago, I blogged about why I bought a Watford FC shirt, when I’m a Spurs fan. Now, I’ve just invested in a Crawley Town t-shirt. Why? It’s all about cryptocurrencies. Watford, sponsored by a bitcoin exchange, has been followed by Crawley Town, purchased by an American group led by Preston Johnson, a cryptocurrency millionaire.

Crawley is a large industrial town near Gatwick Airport, England. In an interview with one member of the crypto group who bought the club – the club was available at a relatively affordable price of between 4 and 5 million pounds – described the area as the “Newark, New Jersey, of England.”

The story was featured in a lengthy article over the weekend in The New York Times, and is well worth a read as how often do you find a sports story centred upon crypto, NFTs and a team captain whose twitter handle is Blockchain Jorge?

I’ve edited the meaty bits out of the story for the blog, so … enjoy!

 

British Soccer, Brought to You by American Crypto Optimism

A group of American cryptocurrency investors are trying to turn an obscure English soccer club into the ‘internet’s team,’ with a global following of crypto enthusiasts.

Preston Johnson, a soft-spoken cryptocurrency millionaire, ‘and a group of fellow American crypto entrepreneurs raised $18 million to buy Crawley, a soccer club competing three divisions below the flagship Premier League. They set up a business entity, WAGMI United. Pronounced “wag me,” the name stands for “We’re all gonna make it,” a popular rallying cry in crypto circles.

'With a flourish of tech industry bravado, the owners had pledged to turn lowly Crawley into the “internet”s team.” They aimed to build a global following of crypto enthusiasts and propel the club to greatness — or at least help it move up from the fourth division to the third. Mr. Johnson pitched the soccer takeover to business partners as a real-life version of the feel-good TV show “Ted Lasso” — but one injected with “crypto cocaine.”

‘Over the summer, they raised $4.8 million from the sale of a line of soccer-themed NFTs, the unique digital collectibles that exploded in popularity last year. The owners used the proceeds — which amounted to about seven times the club’s revenue last season — to invest aggressively in the team, hiring data and video analysts and recruiting a star striker. They also reduced season-ticket prices and pledged to involve fans in the club’s decision-making with a transparent, egalitarian management style that they portrayed as a reflection of crypto’s utopian principles.

‘Mr. Johnson insists that his soccer project is different. Rather than selling crypto to Crawley fans, he said, the ownership group is trying to sell Crawley to crypto fans and thus create new sources of revenue for the club.

‘Over the summer, the team unveiled a new jersey featuring the “chromie squiggle,” a rainbow design that appears in a popular NFT collection.

See: https://opensea.io/collection/chromie-squiggle-by-snowfro

 

‘The club’s most ambitious crypto initiatives revolved around the NFT sale. Anyone who has bought a Crawley NFT is entitled to a vote on certain club decisions; a recent ballot helped determine the team’s priorities in the transfer market.

‘Mr. Johnson has also pledged to give season-ticket holders and NFT owners the chance to vote him out of Crawley’s leadership if the club isn’t promoted to a higher division by 2024. (Mr. Francomb may not be eligible to participate in that referendum; he passed on the NFT sale. “I didn’t have too much disposable ETH,” he said, using shorthand for a popular cryptocurrency. “They priced out their own captain.”).’

The project began at a dinner in 2021 and, ‘over the next few months, Mr. Johnson and Mr. Smith cobbled together a group of about 35 crypto proponents, including Gary Vaynerchuk, the NFT entrepreneur, and Daryl Morey, a blockchain enthusiast who is also president of basketball operations at the Philadelphia 76ers. They set up a business entity, WAGMI United. Pronounced “wag me,” the name stands for “We’re all gonna make it,” a popular rallying cry in crypto circles.

‘Crawley’s captain, George Francomb, is known as an experienced and versatile professional, a good passer with the ability to play in multiple positions. On Twitter, however, he operates under the pseudonym “Blockchain Jorge,” posting crypto memes and trading tips. He is probably one of only a few players in the division with an informed opinion on the complex crypto software update known as the Merge. Sometimes, he explained in an interview, he’s asked whether he fully understands the risks of crypto. “I understand the risks of keeping my money in Great British pounds,” he said. “That’s what I say.”’

‘To spearhead the marketing, they recruited Andy Haynes, a stand-up comedian whose ideas have sometimes pushed the boundaries of taste.

‘In September, WAGMI announced plans to scout players from a group of British influencers called the Sidemen, prompting cries of indignation from fans who said the stunt was a distraction and a waste of resources. “I get that it is not OK if we lose and get relegated, but, at the same time, it’s, like, we were trending that day on Twitter,” Mr. Haynes said. “The people that are winning our league right now. …” His voice trailed off. “They have never trended.”

 

Postnote:

‘As digital currencies gained widespread popularity last year, crypto advertisements became ubiquitous in the world of sports. A Coinbase commercial aired during the Super Bowl. The crypto exchange FTX, run by the billionaire Sam Bankman-Fried, bought the naming rights to the Miami Heat’s arena. In Europe, a company called Socios markets soccer-centric “fan tokens,” special digital currencies associated with teams like Barcelona and Manchester City. To critics, the crypto industry’s flood of sports marketing looked like an opportunistic strategy to lure young men into speculative investments.’

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Chris M Skinner

Chris Skinner is best known as an independent commentator on the financial markets through his blog, TheFinanser.com, as author of the bestselling book Digital Bank, and Chair of the European networking forum the Financial Services Club. He has been voted one of the most influential people in banking by The Financial Brand (as well as one of the best blogs), a FinTech Titan (Next Bank), one of the Fintech Leaders you need to follow (City AM, Deluxe and Jax Finance), as well as one of the Top 40 most influential people in financial technology by the Wall Street Journal's Financial News. To learn more click here...

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