Fan tokens struggle to hold on as World Cup quarter-finals draw nearer

CointelegraphPublicado em 2022-12-07Última atualização em 2022-12-07

Resumo

Soccer fan tokens have seen their prices and trading volumes plummet since the start of the World Cup on Nov. 20.

⠀

Cryptocurrencies tied to national soccer teams have failed to keep the attention of 2022 FIFA World Cup fans, with many soccer-linked fan token prices plummeting since the tournament began.

⠀

Between Portugal, Spain, Brazil and Argentina, the associated digital fan tokens have fallen between 60% to 88% percent in price since the start of the World Cup on Nov. 20, according to CoinGecko.

⠀

This is despite Brazil, Argentina and Portugal reaching the quarter-finals, while Spain was a strong contender up until they were knocked out on Dec. 6.

⠀

The tokens do generally react to immediate results, with Spain's SNFT token down 39.1% over the past 24 hours following the team's loss against Morocco, however, Portugal's POR token is also down 6.1% over that same time frame, despite them beating Switzerland 6-1 on Dec.6. Such suggests that the tokens are becoming less reactive to the associated teams’ success.

⠀

Notably, these cryptocurrencies saw their peaks well before any of the teams even walked on the soccer field in Qatar, suggesting a classic “buy the rumor, sell the news” event took place.

⠀

Both the Portugal and Argentina fan tokens hit their all-time highs (ATHs) on Nov. 18, while the ATHs for Spain and Brazil fan tokens came two months prior on Sept. 28.

⠀

A similar occurrence can also be seen on the chart for Chiliz (CHZ), the native token behind the major fan token platform Socios, which pumped to its own ATH on Nov. 20 but has since dropped 36%.

⠀

The 24-hour trading volumes of tokens have also dropped off drastically since kick-off — falling between 79% to 88% since Nov. 20.

⠀

This class of tokens was originally designed to offer fans unique interaction opportunities with teams they support, such as allowing tokenholders to vote on minor decisions like what is to be written on the captain’s armband.

⠀

Critics of fan tokens see it differently, however, and view the market as a predatory way for experienced traders to milk enthusiastic fans out of capital.

⠀

Speaking to The Athletic in Aug. 2021, Martin Calladine, author of The Ugly Game — a book exploring the dark side of FIFA’s dealings with Qatar and its bid for the 2022 World Cup — offered a grim take on the fan tokens.

⠀

“We see the price of tokens being driven up in anticipation of football events like signings or titles,” he said, adding that “traders cash them out, prices crash, and fans are left sitting on losses — victims of their enthusiasm for their clubs.”

Leituras Relacionadas

Bessent's True Agenda

U.S. Treasury Secretary Besant's recent interventions in the bond market are seen by some as an attempt to artificially trigger a massive short squeeze before the midterm elections. The alleged goal is to push the 10-year yield toward 5% initially, then use covering by short sellers to drive it down to around 4.3%, providing political breathing room for the Trump administration. Analysts point to near-record short positions held by CTA trend-following funds. According to Goldman Sachs data, a price rally of two standard deviations could trigger historically large short-covering. Besant's tactics reportedly include bond buybacks, shifting issuance toward shorter-term debt, and potentially canceling ultra-long bond auctions to pressure these market positions. So far, interventions like modest buybacks have had limited effect on yields, with the Treasury later hinting at using its General Account (TGA) cash for support. Critics argue these measures cannot address structural pressures like large deficits and high inflation. Instead, the strategy appears tactical—aimed at buying time and exploiting technical market vulnerabilities rather than reversing the underlying yield trend. The political timeline is clear: achieve lower yields ahead of the midterms to help lower mortgage rates and craft a favorable narrative. However, analysts warn that once the election passes, structural upward pressure on yields and equity valuations could reassert themselves more forcefully. Market signals suggest this potential short-squeeze dynamic could intensify in the coming days.

marsbitHá 5m

marsbitHá 5m

Jackson Hole Speech Preview: Is the Fed Seeking Justification for a Rate Hike?

"Jackson Hole Speech Preview: Is the Fed Looking for Reasons to Raise Rates?" Ahead of the key Jackson Hole symposium, Federal Reserve officials and the IMF are signaling heightened concern over persistent inflation, with some advocating for tighter policy. Boston Fed President Susan Collins, in a recent article, supported holding rates steady only if evidence of falling inflation continues. Otherwise, she argues for prompt tightening, noting inflation has been above target for over five years and warning that prolonged deviation could entrench consumer expectations. Although not a voting member this year, her stance aligns with several officials; three FOMC voters dissented in July, favoring a rate hike. Richmond Fed's Tom Barkin warned of a future "reckoning" regarding the $40 trillion public debt, while IMF Managing Director Kristalina Georgieva urged central banks to maintain a laser focus on price stability. The core dilemma lies in the sources of inflation: Trump-era tariffs, Middle East conflict-driven oil prices, and surging AI investment. Collins believes the first two factors are fading, but identifies AI infrastructure spending as exerting "upward pressure" on core goods inflation. The problem is that interest rate hikes primarily curb demand, not these supply-side shocks. Georgieva framed it as a "tug of war" between negative supply shocks from the Middle East and positive demand shocks from AI. Meanwhile, economic data shows strain. The August Consumer Confidence Index fell to a seven-month low of 89.4. While the present situation index improved, future expectations plummeted. Consumers expect higher inflation (5.8% vs. 5.6% last month), likely influenced by high gas prices. Other data points are weak: July retail sales saw the largest drop in over a year, and job growth stalled. Key upcoming events include the July PCE inflation data (expected to remain well above the 2% target) and new Fed Chair Kevin Warsh's first major speech at Jackson Hole. Market pricing remains conflicted, showing a high probability of a December hike but expecting no move in September. Gold prices, however, have surged over 7% to near three-month highs, signaling market anxiety.

marsbitHá 20m

Jackson Hole Speech Preview: Is the Fed Seeking Justification for a Rate Hike?

marsbitHá 20m

Today, HYPE Activates Its Second Buyback Engine

"Hyperliquid Activates Second Buyback Engine with AQAv2 Launch" On August 26th, Hyperliquid officially activated its Aligned Quote Assets v2 (AQAv2) mechanism, introducing a major new source of revenue and buyback power for its native token, HYPE. Unlike the existing revenue stream from trading fees, AQAv2 generates income by sharing approximately 90% of the adjusted reserve earnings from stablecoins (primarily USDC) circulating on the Hyperliquid chain. This income is settled every 30 days and automatically funneled into the Assistance Fund for HYPE buybacks, with the first expected distribution on October 3rd. Through a partnership with Circle (issuer of USDC) and Coinbase (treasury manager), Hyperliquid leverages its user base and financial infrastructure to share in the yield generated by stablecoin reserves. This transforms its liquidity and distribution capabilities into a scalable business model. Initial estimates project AQAv2 could generate $150-200 million in annual buyback funds, based on the current ~$6.43 billion USDC supply on Hyperliquid and an assumed reserve yield. Crucially, this revenue is weakly correlated with trading activity and grows directly with the platform's stablecoin adoption. With HYPE recently reaching an all-time high, AQAv2 provides a new fundamental support layer. It shifts Hyperliquid's value capture beyond just transaction fees, anchoring HYPE's long-term buyback potential to the expanding scale of its stablecoin ecosystem.

marsbitHá 24m

Today, HYPE Activates Its Second Buyback Engine

marsbitHá 24m

NVIDIA Earnings Preview: The Market No Longer Expects a Positive Surprise

NVIDIA's upcoming earnings report has seen market expectations shift from anticipating big positive surprises to seeking clarity on capital allocation and future growth sustainability. While analysts forecast Q2 revenue near doubling year-over-year to $92.18 billion, option markets are pricing in a relatively muted post-earnings stock move of around 5.4%—the lowest implied volatility in two years. This reflects a growing sense that the phase of massive AI-driven earnings beats and stock surges may be ending. This year, NVIDIA's stock has slightly underperformed the S&P 500 and significantly lagged the semiconductor index. Analysts now emphasize the need for more than just beating estimates. Key investor focuses include details on how NVIDIA will deploy its capital, maintain its exceptional gross margins amid rising costs, and use its substantial free cash flow for investments and share buybacks. The forward P/E ratio of about 21x suggests the market is already pricing in a growth deceleration. NVIDIA's recent strategic moves—like facilitating massive AI financing, guaranteeing loans for data center projects (including a major one for OpenAI), and investing in power infrastructure—have positioned it beyond a mere chipmaker. However, this raises questions about potential "circular financing," where revenue might be artificially supported by lending to customers. The health of its AI clients, like OpenAI which reported slowing revenue growth, is now crucial. The report arrives amid a challenging backdrop: political pushback against AI data centers, rising borrowing costs, and massive debt-funded spending by cloud giants. Investors are keenly watching for signals on the transition to the new Blackwell and upcoming Vera Rubin architectures and, ultimately, whether the explosive demand for AI is losing momentum.

marsbitHá 35m

NVIDIA Earnings Preview: The Market No Longer Expects a Positive Surprise

marsbitHá 35m

Saylor Pauses Bitcoin Purchases: The World's Largest Bitcoin Holder Is Transforming into a 'Digital Asset Bank'

Saylor's Strategy has paused its long-standing practice of buying Bitcoin, marking a significant shift for the world's largest corporate BTC holder. The company is now prioritizing capital structure management over accumulation. Strategy recently raised $2 billion by selling shares but purchased zero Bitcoin, directing funds instead to a new USD cash reserve, repaying preferred stock, and building its dollar liquidity pool. This follows a series of BTC sales in 2026, totaling around 6,916 coins, often at a loss, to meet its substantial annual dollar obligations of approximately $1.76 billion in dividends and interest payments. The core change is the adoption of a new "Digital Credit Capital Framework." Strategy is transforming from a leveraged Bitcoin proxy into a "digital asset bank." Its focus has shifted from simply increasing its BTC holdings to managing a balance sheet where Bitcoin acts as the reserve asset, common stock as equity, and preferred shares as liabilities. The goal is now to optimize the "Bitcoin per share" metric and maintain stability, even if it means selling BTC at a loss during market stress to protect its financial footing. The market appears to be re-evaluating Strategy, pricing it less as a volatile Bitcoin tracker and more as a capital management firm. Despite its recent sales, Bitcoin's price has surged, indicating Strategy's selling pressure is easily absorbed by broader market flows like ETF inflows. If successful, Strategy could emerge as a novel hybrid: a "Bitcoin bank." However, this path carries major risks, as sustained BTC prices below its average cost could steadily erode its financial safety net.

marsbitHá 1h

Saylor Pauses Bitcoin Purchases: The World's Largest Bitcoin Holder Is Transforming into a 'Digital Asset Bank'