When fans and fan groups pushed for more say in their clubs in the wake of the Super League fiasco, that wasn’t quite what they had in mind.
Clubs around the world have announced partnerships with Socios, the fan token platform that uses the Chiliz cryptocurrency and blockchain infrastructure.
These clubs include Barcelona, Paris Saint-Germain, Juventus, Milan and Man City.
The platform is advertised as a fan engagement tool – something that allows fans to have their say on certain aspects of their club, but the reality is very different and has side effects that some fans may not be aware of.
Supporters of the English clubs working with Socios – Leeds, Everton, Arsenal and City – have in varying degrees expressed their concerns about the platform and the idea that it monetizes fan engagement.
We recorded a Patreon episode about Socios @ ugly game but decided that it was too important a topic to be limited to our subscribers so that you can now listen to it on our free to air feed. At this point we usually say, “Have fun!” but there isn’t much to enjoy here … https://t.co/fuJ4tZTbvt
– All statistics are not us (@AllStatsArentWe) August 13, 2021
The Leeds United Supporters Trust released a statement after announcing its club’s partnership, stating that they are involved with socios: “Fans will be required to join a cryptocurrency ecosystem; something that many may know very little about. ”
West Ham had previously entered into a partnership with Socios, which however ended in 2020
“We are very pleased that the partnership between West Ham and Socios has ended. We hope another scheme of exploitation for fans [of this nature] is never introduced in our club.
While there are no signs of Liverpool joining Socios at this point, the club would do well to continue to steer clear of it.
Instead, they should try to use existing fan infrastructures such as the Spirit of Shankly fan union and the club’s own global membership system to support fans and help them have a say in certain matters.
The word socially itself is used in Spanish football to describe the members of a club. Barcelona is an example of a club controlled by its members – the socially – Who can vote on various topics, in particular the appointment of club president.
That word has been hijacked somewhat from this fan engagement and trading platform, using an existing word describing one form of supporter engagement to further disguise the other side of their platform.
When signing up for Socios, there is an initial disclaimer that states that “$ CHZ [the crypto abbreviation used for Chiliz] and Fan Tokens do not represent financial instruments or any form of investment product. They are intended to be used for entertainment and fan experience purposes only.
But the fluctuation in the value of the various fan tokens shows all the hallmarks of financial trading and, in particular, the more volatile nature of cryptocurrency trading.
An obvious example of this was the value of Atletico Madrid’s fan tokens in connection with last season’s La Liga title win.
Instead of gaining in value as they tried to secure the stock, there was a sharp decline as traders tried to sell at the high.
This was examined in more detail in this thread by Martin Calladinewho has explored Socios’ relationship with football since they first appeared on stage.
The token price started the week at just over 100 chiliz and rose to around 140 on Saturday morning. They then continued to move up as the game started. But instead of peaking after the win, they hit nearly 190 chiliz after about 70 minutes. pic.twitter.com/UJPF3XJ4XN
– Martin Calladine (@uglygame) May 24, 2021
Even the Socios app itself displays information like an exchange, lists the value of the tokens, and displays graphs that show the price fluctuations:
In theory, there should be little fluctuation if these tokens are bought exclusively by fans of a club. A steady increase would be expected as membership increases and more people adopt the platform. After all, it’s rare for someone to simply stop being a fan of their club and sell such a membership.
The fact that so many tokens are being sold at certain times is one of the most obvious signs that fans are only a percentage of those who own the coins.
Football’s relationship to money is a long-standing problem that continues to get worse and mirror the whole world, but in its own hypercapitalist bubble. From gambling sponsorship to ownership issues, everything is for sale, often regardless of who the buyer is or what they are promoting.
The problems surrounding soccer clubs, which bear the name of gambling sponsors, have been widely debated and could reach a stage where there are similar discussions about encouraging fans to invest in crypto, which itself carries a financial risk.
It might have gone unnoticed that Liverpool already has a partnership with an online trading broker called ThinkMarkets. They are an online forex, stocks, indices, precious metals, commodities and cryptocurrency brokerage company.
So Liverpool already has a connection to cryptocurrency trading, but it is presented transparently and simply for what it is – an online trading and investment platform. There is no cover up and fans are not caught under false pretenses.
Top-level football has already accepted partnerships with financial firms and, controversially, gambling partners.
In this case, the club understands that it is partnering with an investment company and its presence may be limited to the more business-related areas of the club’s work.
Conversely, the problem with clubs that work with socios is that it is presented as fan engagement, while that fan engagement is actually just a series of bonuses that result from buying or investing in cryptocurrencies.
It’s cryptocurrency trading masquerading as fan participation. The presence of the loyal fan provides a bit of stability, but the value will vary widely based on the actions of non-fan traders.
There have been several news reports in the mainstream media exploring how influencers can make the value of a cryptocurrency rise or fall.
A headline in the Independent The reading; “Floki crypto price rises 250% after Elon Musk got a new dog,” underscores how unearthly this stuff can appear when planted on more mainstream, familiar news.
In the case of Socios, the influencers are the clubs – what could be a better influencer than an entire football club and its army of loyal supporters.
As a report in Athletic points out, most of the chatter about these club coins does not come from fans, but from the other group of investors – the cryptocurrency traders.
Athletic’s report also indicated that the decisions fan token holders can participate in “don’t seem to be about topics that fans are generally passionate about, such as transfer deals or game tactics. Rather, many of The Athletic’s voices focus on seemingly trivial matters like music selection in the stadium or the design of social media.
The desire for greater commitment from the fans is usually not about having a say in transfers or tactics, but rather a question of maintaining the club’s values, fan relationships and club culture through decisions outside the field of play.
The Socios platform would be even more problematic if it could influence decisions and transfers on site. After all, nothing prevents fans from buying tokens from clubs that they don’t support and from having a say in the various votes.
The Football Supporters Association, which represents fans in England and Wales, has already spoken out against Socios.
In conversation with the I Newspaper CEO Kevin Miles said: “It is disappointing to see clubs trying to monetize fan engagement with cryptocurrency – fan engagement should be free, democratic and recognize the value of independent fan organizations.
“There shouldn’t be any financial barriers to working with your football club, and the FSA will talk to support groups and our members below
Club partnerships with financial firms require more in-depth discussion as part of the broader question of football’s relationship to capital and its impact on the fans, but these partnerships are usually transparent.
Liverpool, after all, has the name of a bank on the front of its shirts – Standard Chartered – and has commercial partnerships with financial firms like ThinkMarkets and Alexbank.
However, regardless of what disclaimers the fan tokens are going to be used for, Socios still feels misleading.
It doesn’t seem to stop crypto traders from simply looking at it as a money-making opportunity and driving the price of tokens up or down for real fans.
There is still a lot of work to be done to improve football’s relationship with its fans, especially at the top level. Even if new technologies can play a role in this later, a platform like Socios shouldn’t.