Exclusive interviews uncover an unlikely marriage between the world’s most popular sport and blockchain that symbolizes a drive towards mainstream adoption.

As you may have heard, blockchain is causing “disruption” everywhere. As it continues to eat its way, Pac-Man-style, through every industry in every sector, we begin to uncover its uses in sport. Naturally, the technology has found itself center stage once more, or in this case, the center of the playing field.

A number of star players have already hopped on the crypto train; Michael Owen recently launched his own cryptocurrency (OWN) — which ironically lets him own £7.50 of your money in return for your right to purchase more of his merchandise. Barcelona’s Lionel Messi, Andrés Iniesta and Carlos Puyol are others who have supported various crypto ventures.

In addition to celebrity millionaires trying to earn an extra buck, other initiatives aim to institutionalize the relationship between crypto and football—so it seems just about everybody wants a piece of the crypto-flavored pie.

The biggest demonstration of this comes from a tiny club, hidden away on the southern tip of Spain. Last year, Gibraltar United, and its spirited owner Pablo Dana, made international headlines when the club became the first in the world to pay players partly in cryptocurrency, through a sponsorship with Quantocoin (at which Dana is also a partner).

On an afternoon of gentle sunshine in Gibraltar, we chat to the Argentinian-born fintech entrepreneur about his views on the crypto industry, and how his investment in over three football clubs is just the beginning of an exciting new era.

The 51-year-old father of five says he was introduced to crypto by his children. With more than a hint of suspicion in his voice, he reflects on an early memory:

“Perhaps they were using it back then to get hold of some fake IDs!”

Paternal disapproval aside, Dana is quick to identify the benefits of using crypto to land the right players for his team, and says crypto is there to help those foreign players who cannot easily set up bank accounts.

“Last year we had this incredible player arrive in Gibraltar called Ayamn Al-Dubashi. He had come from Egypt and couldn’t open up a bank account, it was mission impossible… we had to pay him in cash.”

An avid investor in football and crypto, Dana had his reasons for choosing Gibraltar United as the main platform from which to launch his years-long crypto-football experiment. And he thinks the distant fantasy of widespread adoption is slowly becoming a hopeful reality.

When players and club officials unanimously agreed on partial crypto payments, a new era was born. Suddenly, little Gibraltar United was the center of a worldwide media frenzy, and the club found itself fielding questions from international papers, broadcasters and crypto media about how, why, and what next.

Through it all, Dana has remained calm and committed to the principles that led him to take that pioneering first step with Gibraltar.

“The idea is to help them understand the whole concept of crypto. When helping our players to understand the value and use of cryptocurrency, owning crypto [makes it easier to grasp] than just reading about it.”

At the World Football Summit in Madrid last September, Dana was one of the main speakers talking about disruption in the football industry. He was joined by like-minded advocates, including Sam Jones from London Football Exchange, and Andrea Agnelli, the chairman of Juventus Football Club.

Pablo Dana speaks on a panel on crypto and football — World Football Summit, Madrid 2018

Dana reminisces on his role in these romantic roots of crypto breaking out in football.

“We led the way. We’re lucky to have started doing this, but this goes back way before the summer [of 2018]. But as soon as the article in the guardian talked about it, it became viral!”

Pablo Dana with Gibraltar United ambassador Luis Garcia

He speaks fondly of his journey into crypto and his hopes for the future. It is fitting and evocative because the daring adventure on which Dana has taken Gibraltar United, being the first to use crypto as a form of salary, has been one of crypto and football’s most revolutionary and memorable turning points.

You certainly cannot ignore Dana’s genuine enthusiasm.

“We’re believers in football, we’re believers in transparency, we’re believers in this new technology.”

There is something in the air

Meanwhile, another notable movement in crypto history is Wolverhampton Wanderers FC’s partnership with CoinDeal, a cryptocurrency exchange which launched in March 2018, in conjunction with the world’s first exchange-sports sponsorship.

CoinDeal was founded by Adam Bicz, Filip Dzierżak, and Kajetan Maćkowiak. We recently interviewed Maćkowiak to find out how a sponsorship with a Premier League football team has impacted the company so far and what their take on the crypto world is.

Maćkowiak talks extensively about some of the benefits that the football industry holds.

“We did a thorough review of our business goals before we even started to think about sponsoring football. It’s obvious that there is no bigger sport market than football… Like they say — just shoot for the stars and in this case, the star was [the] Premier League.”

The football club will see the CoinDeal name, and a color-tweaked version of its brand ID, appear on the sleeves of the team’s famous old gold kit, as well as appearing on all its training gear and extensive signage around its ground, Molineux Stadium. Having a well-known kit brand your company’s logo has surely got to be rewarding, but what benefits does football have over other sponsorship opportunities?

“It is easier to plan something when you know that there are 38 games to play in a season. There are more chances to show our logo… more TV coverage.”

But perhaps the most important factor in all of this is the future of these utility tokens in football. Will there be many other uses of coins in the future?

Maćkowiak’s vision is neatly encapsulated through his next response:

“Utility tokens will find their place in the crypto ecosystem as a means to engage fans and reward users for content. Great use of utility tokens is something called a Token Curated Registry (TCR), and that’s something that we will see more of in the near future. Not only will teams use these tokens for voting, but [they will also] offer merchandise in exchange for these tokens, as well as discounts to those that use tokens. Imagine, a person that gets rewarded with tokens for each consecutive year that he or she remains a season ticket holder. Tokens issued by clubs will create entire micro-economies that allow for greater gamification, engagement, and reach.”

So, it’s fair to ask, is crypto inevitably morphing into a remorseless superpower?

The ascent of cryptocurrencies is not unlike the rise to stardom and riches experienced by many professional football players. Indeed, it seems players past and present are taking the plunge, and the rest of the football world is taking notice, with major teams in Europe’s top leagues beginning to lead the way.

In August 2018, seven English Premier League clubs — including Tottenham Hotspur, Newcastle United, and Leicester City— signed one-year marketing partnerships with eToro. As part of these partnerships, the clubs received payment in Bitcoin.

More significantly though, the rise of Socios, a tokenized fan voting platform for sports, has been remarkable. From its infancy, the platform joined forces with football giants like Juventus and Paris Saint Germain. Its main goal is to enhance fan engagement and develop an open, gamified Fan Token economy for supporters, giving them a seat at the table on important decisions within their clubs.

Football fans can buy, trade and execute voting rights (for example, what the club kits should look like next season) on the Socios.com platform, empowering them to take an active hand in how their clubs are managed.

Socios.com is powered by CHZ token and the chiliZ fintech platform. We recently spoke with chiliZ CEO Alexandre Dreyfus, who explained how they managed to secure illustrious partnerships with some of the biggest names in football.

“Paris Saint Germain recognized the value of having an enhanced level of fan engagement and, like Juventus, the second club to partner with Socios.com, understood that this digital revolution is the future of fan engagement. We see sport as the ideal vehicle for the mass adoption of cryptocurrency through blockchain technology by taking tokenization to billions of sports fans across the globe.”

Similarly to other like-minded people we spoke to in the lead up to this article, Dreyfus was quick to turn the conversation to how blockchain can help bring about a new era of transparency.

“When it comes to football specifically, blockchain brings a level of unprecedented transparency to the beautiful game, with the potential to reduce or even eliminate illegal ticket touting practices as well as the sale of counterfeit sports merchandise. The use of digital currencies is certainly in line with UEFA’s 2017 anti-match-fixing initiatives to combat corruption, fraud and money laundering. There is a unique opportunity for blockchain and the token economy to fight corruption in a sport which has been rocked by a number of high-profile scandals over the years.”

Do these partnerships come without their risks?

The Financial Times (paywall) quoted a senior executive at one of England’s leading football clubs as saying:

“We don’t want to wake up tomorrow and see loads of our fans losing money on a product that we have been endorsing.”

The fear of fans losing money doesn’t appear to extend to the legions of betting and gambling companies that have flooded the sport over the years, emblazoned on team kits, across advertising hoardings, and in the prime 30 second TV spots right before kickoff. Reputable crypto is at least an asset.

Whether a club chooses to explore blockchain and crypto is a choice for each of them. But what’s undeniable is that the industry is growing at a speedy pace, and the head-honchos at clubs of all sizes and around the world are clearly intrigued by the possibilities.

Fighting scandal with blockchain…for a bright future ahead

A central theme that kept cropping up in all of these conversations was the need to tackle corruption in football.

And so back to Pablo Dana, the owner of Gibraltar United. Never shy to offer an opinion, he says the open-access nature of blockchain could finally help stamp out the corruption scandals that have plagued football for so many years.

He explains that his club is thinking of implementing smart contracts in order to avoid corruption and bring about true transparency:

“Which [is] exactly what UEFA and FIFA have been asking clubs to do for many years. So here we go, we are the first ones!”

If he and other crypto-football pioneers get their way, blockchain looks set to steamroll the crooks and liars that have tarnished the sport through many high-profile scandals. The dark, scandalous clouds of past and present may finally be retreating to reveal a new, enlightening, positive horizon for the future of the sport.