Being a football enthusiast is one thing. But what about owning shares in your favorite club? Apparently, blockchain may make such dreams reality.
Today’s case was previously mentioned in the last Weekly Update – but it is interesting enough for a separate article. After all, not every day, we can witness the situation in which an institution not-related to the blockchain industry is bought by a cryptocurrency-based entity.
Our story begins with Perth Glory, an Australian football team. As we learned last week, it is going to be acquired by the London Football Exchange Group (LFE). The company calls itself a football club stock exchange, and it is strictly related to the cryptocurrency industry. LFE gained in significance with 2018 ICO when it raised $70 million, which allowed it to launch its own token, LFEC, based on Stellar blockchain.
Perth Glory is playing in the Australian A-League – the highest-level league of professional football in the country. As you can see, we are not dealing here with some marginal sports club, but the established player on the worldwide scale. It makes the last revelations somehow an important matter both for the cryptocurrency industry and the sports world.
The club owner, a well-known Australian businessman Tony Sage, has recently confirmed the sale of 80 percent of the club to the LFE. Both sides are now only waiting for the confirmation from Football Federation Australia, the country’s main sports governing body. According to LFE, there won’t be any changes in the management structure of the club, nor in the operations or functionality.
Crypto football manager
But what exactly is the London Football Exchange, and why is it acquiring an Australian football club? According to the company’s website, LFE is aiming to utilize blockchain for the benefit of both football clubs and their fans. As for the first ones, the platform is meant to be a form of funding alternative for clubs, allowing clubs to raise new capital directly from people interested in such investment.
As for the fans, LFE is going to create a tokenized marketplace, offering various products related to their favorite clubs. The wide range of services started with ticket sales and merchandising, but the platform is also going to include accomodation, broadcast, and football retail services. On top of that, most devoted fans will, of course, be able to invest in particular clubs.
All of those functions will be supported by LFEC token. And the company is not going to stop at only one club – the idea of LFE assumes gathering funds for buying more football teams. This way, sports enthusiasts will own shares in their favorite clubs by buying LFEC. At least in theory.
Although the case is still new, and we can’t be sure what the relationship between LFE and Perth Glory will look like in practice, the very idea of fans buying shares in firms is intriguing. In theory, it is going to utilize the blockchain to have more significant influence on their favorite entities. But on the other hand, how will such a process differ from owning traditional shares on a stock exchange?
The only hope remains in the blockchain technology, which could possibly give such stakeholders some tools to influence – for example, via voting systems. But it still leaves us with one problem: the owners who acquired a larger number of tokens are likely to have a more significant influence.
Nevertheless, the detail about the functioning of Perth Glory is still unknown. And since Tone Sage assures that LFE won’t influence the management of the club, then maybe owning tokens actually won’t have any particular meaning other than contributing to the favorite club. Yet the idea of community buying off some entity and self-governing it via blockchain is still very interesting.
According to Tony Sage, LFE is currently negotiating with other football clubs about a similar deal, and he believes that the community-oriented blockchain marketplace will own up to seven football teams in the next two years. The businessman himself strongly believes in the success of this cooperation. And he surely has a nose for various investments, since he made his fortune on the mining (the physical one, not blockchain).
Yet, not everyone is as enthusiastic about the deal as Sage. Outside the blockchain industry, information about being acquired by a cryptocurrency-related company is still quite a new thing. Many sports enthusiasts might be skeptical about such a situation rather than be happy about the possibility of closer integration between a sports club and their fans. But on the other hand, if funds for buying Perth Glory are indeed coming from its supporters, then everyone should be happy about that outcome.
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