Fan tokens are a form of cryptocurrency that gives holders access to a variety of fan-related membership perks like voting on club decisions, rewards, merchandise designs and unique experiences.
Fan tokens are cryptocurrencies that permit their holders to access a variety of fan-related membership perks like voting on club decisions, rewards, merchandise designs and unique experiences. They can be used by sports clubs, music fan clubs and other organizations to democratize and organize experiences, establish club leadership and more.
Unlike NFTs, fan tokens are completely “fungible” or interchangeable. This means that, just like fiat or cash, the tokens can be exchanged for sports club merchandise, VIP experiences and more. Additionally, they play an important role in tightening the club community with another team-branded piece of fandom.
Fan tokens are cryptocurrencies that aren’t necessarily backed by underlying value principles of Bitcoin or Ethereum. They receive their worth from how much fans value being able to participate in the club and earn unique benefits.
The Chiliz token is the first and most prominent fan token that has prompted an explosion of new tokens like the Manchester City Fan Token, AC Milan Fan Token, the Juventus Fan Token and many more. These currencies are a brand new use case for crypto as innovation across the blockchain space reaches new highs.
How Do Fan Tokens Work?
Fans can purchase digital tokens and trade them like other cryptocurrencies. When trading, the price of a fan token is generally set by the seller. It is also subject to change according to market movement and how popular the token is at the time.
Once users gain access to a set amount of fan tokens, they are granted the right to vote on a variety of matters concerning their favorite club. These matters that fans can vote on largely depend on the club, but they could include:
- A club's merch design
- Tour bus designs
- Ticketing matters
- Match locations
- MVP categories
These perks allow fans to feel more involved in the club they already support, and they add an extra level of pride and prestige as their fan tokens will likely increase in value as the club grows over time.
Fan tokens create an exclusive community of the most dedicated fans. They give a new way for fans to take part in an exciting voting and rewards system. The more fan tokens you own, the more sway you have over the club and the more loyalty you show to your team.
How to Buy Fan Tokens
Fans must purchase CHZ via a crypto exchange in order to acquire fan tokens that exist on the Chiliz network. However, there are fan tokens that exist outside of Chiliz and their Socios.com website.
These tokens are specific to a team or club and are rare digital assets that provide access to an encrypted ledger of voting and membership rights ownership. CHZ tokens can also be used to purchase and trade different fan tokens on Socios.com. Fan tokens can be traded on Chiliz.net – their in-house exchange and trading platform against CHZ.
Some fan tokens are available on popular centralized exchanges, but some may not be certified or large enough to be listed yet. In this case, fan tokens could only be available for trading or swapping on decentralized exchanges (DEX) like PancakeSwap. You will need to have a cryptocurrency to trade for fan tokens on DEXs.
You can currently buy the largest fan token, Chiliz on platforms like:
- Binance.com
- Coinbase Pro
- Huobi Global
- Bithumb
- KuCoin
- Chiliz
Learn more about buying cryptocurrencies with this guide.
How to Identify a Fan Token
Fan tokens generally are used as a part of fan clubs and sports clubs. They differ from other cryptos like Ethereum or Chainlink because they don’t solve the same financial or technical problems. In other words, they are more of a fun, rewards-based token.
Here are a few fan tokens that span both sports and music:
- KPOP Fan Token
- Professional Fighters League Fan Token
- Paris Saint-Germain Fan Token
- FC Barcelona Fan Token
- Galatasaray Fan Token
What Is Chiliz?
Chiliz describes itself as “the world’s leading blockchain fintech provider for sports & entertainment.” Chiliz (CHZ) is the most popular fan token platform to date and it has its own blockchain. Chiliz also developed the Socios.com platform for fans to engage with their favorite teams and clubs.
CHZ is the native ERC20 utility token on the Chiliz network that is secured by the Ethereum blockchain, serving as the digital currency for the Chiliz and Socios.com platform.
Chiliz is generally responsible for the birth of a new form of cryptocurrency – the fan token. Once fans reach the Socios.com platform, club partners host a Fan Token Offering (FTO) – a period where prices of fan tokens are fixed and made available to fans before they reach the marketplace.
Ownership offers fans the ability to vote on a mobile platform, and it acts as a ticket into an exclusive inner circle of fans who share a passion for the team and the sport (or other categories like music). The more tokens a fan holds, the more power they have in their vote (with a higher fan ranking), moving them upwards through different reward tiers until they have access to the biggest VIP benefits that are offered.
Football clubs intend to use Socios.com as part of their fan engagement strategy to continue to build their global fan bases, particularly in Asia where the football fan community is experiencing incredible growth. Socios.com connects the clubs to their fan bases, securing additional revenue streams that are digital, secure, transparent and entirely connected to the real fan experience.
- The CHZ Token enables the Socios.com platform – the consumer-facing site where fans can use tokens to participate in polls and surveys and earn rewards with active engagement.
- Users need CHZ tokens to participate in FTO, the initial sale of fan tokens and to access the Socios Locker Room – a space to entice new club entries.
- The CHZ token is highly liquid and traded globally on some of the major exchanges like Binance, Turkish exchange Paribu, Huobi Global and Mercado Bitcoin in Latin America.
Should I Buy Fan Tokens?
Purchasing cryptocurrency is still seen as a high-risk investment by many. The crypto market is known to be volatile already, and meme coins are the most prone to drastic swings in price. However, great risk can always mean great reward as some fan coins may skyrocket in price if they catch on and become even more popular.
With any investment, it is always best to carefully weigh the value and the solutions presented by the product. Fan tokens may be less of an investment and more of a buy-in to the special benefits that sports clubs can provide.
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