Football (or soccer for our US readers) is a huge multi-billion-dollar industry and is incredibly popular in Europe.
Every season there are two global transfer windows that see players being signed from one club to another in deals that can sometimes be worth hundreds of millions of dollars. Betting is a popular pastime among football fans and followers. Player value is increasing as time goes by. Today, it is commonplace for players to command lucrative pay packets and clubs to make millions selling them.
So, where does cryptocurrency fit into all of this?
It is safe to say that cryptocurrency companies enjoy a fair share of the wealth that cryptocurrencies generate. It is even truer that companies like eToro want to grow their user base and appeal to a wider audience. It was only a matter of time before they made moves to get prominent advertising, and football provides a very enticing prospect for this.
This sponsorship deal is very unusual, however. Typically, a football club will be approached by a sponsor, they will hash out the details about brand coverage and come to an agreement about how much it will cost to represent or advertise them. These sponsorship deals (especially in the UK) are fantastic opportunities for brands as the Premier League gets a huge viewership every week. They are also very expensive with some sponsors even part-funding entire football stadiums, like Etihad did with Manchester City and Emirates did with Arsenal.
It is not a cheap area to move into when it comes to advertising and often, it is only elite-level brands that can afford to get a look in. That is why the sponsorship deal that eToro has struck up with multiple Premier League clubs is so unusual.
The company approached many major football clubs in the Premier League. Of those that it approached they agreed on deals with:
With possibly the exception of the top two mentioned clubs, the remaining clubs aren’t elite-level Premier League clubs, but all command millions of pounds when signing sponsorship deals.
Instead of handing over all of that hard cash to these clubs, eToro signed on the dotted line and transferred the sponsorship fee in Bitcoin.
eToro also provided all of the functionality and knowledge to enable each club to diversify their financial interests and make use of Bitcoin. This means that all seven clubs are now Bitcoin stakeholders, and are able to do exactly what they want with the currency.
This remains to be seen; in all likelihood some of them will cash in the coin for British Pounds to free up finances for the upcoming transfer window.
This might not be the wisest decision as Bitcoin’s value is rising very fast at the moment and they could be losing out on significant gains in the crypto market. That being said, some of these clubs will need the cash flow immediately in order to keep their books balanced and remain competitive with the larger clubs in the Premier League.
Other clubs will hold onto the currency, either as an investment with the view of cashing in at a later point or as an asset that can be relied on during leaner periods of time. Tottenham Hotspur, for example, is currently in the process of a complete financial restructure due to completing their new stadium. This means that they are already pulling in the purse strings and not necessarily looking to spend big in the next few transfer windows. Instead, they could be looking to capitalize on the power of cryptocurrency to further generate revenue and safeguard their own brand.
While this is speculative, it seems from the statements issued by some clubs that they intend to explore the opportunity of Bitcoin and see where it takes them. Football officials have stated they are committed to innovation and love that Bitcoin is a means to innovate the way they do business. Maybe in the future, it will be possible for football fans to transact with Bitcoin for official products.
A big issue in football is brand protection. Many Premier League clubs face issues with ticket touting, as well as the sale of counterfeit products such as merchandise and kits.
With Bitcoin operating in a secure and transparent way it is thought that this would leave fewer grey areas, and enable football clubs to isolate problems and then restrict transactions accordingly. Bitcoin could provide clubs with clarity about transactions and enable them to monitor how their brand is represented financially on the open retail market.
The last very interesting thing is that if this proves successful and Bitcoin is integrated fully with the Premier League, it could only be a matter of time before the first player is paid in Bitcoin or the first player signing is completed in Bitcoin. If that happens it could be the floodgates opening and Bitcoin gaining commercial success in large businesses.