Research summary:
Paris Saint-Germain Fan Token is essentially a token that allows the sports club to connect with its fans and help increase their overall brand awareness. We will focus on how the project works, what value it adds, and review its pros and cons.
The CMP is $6.22 as of 8th July 2022
What is the Paris Saint-Germain Fan Token all about?
There are many categories within the crypto industry and some of them are quite popular. There are stablecoins, privacy-based tokens, governance tokens, store of value based tokens and there is Fan token.
Fan tokens are not as popular as the rest of them, however it is a growing niche and has a of future potential. This is proven by the fact that Cristiano Ronaldo, one of the greatest Football player of all time, has entered the cryptocurrency space.
Until now the sports industry has been limited to the NFT space, it has started to view FAN tokens as another alternative route of connecting and engaging with their fans, finding new ones and making money.
Fan tokens are quite honest about what it offers and does not claim to change the world neither does it claim to be the currency that is superior to the fiat currency. It represents voting power over minor (not major) decisions regarding the Sports Club/ Sports League it represents. The power of Fan tokens was recognized during the pandemic, when most of the sports clubs took a revenue hit as they could not have thousands of people in their stadiums.
PSG, a successful football club based in France, decided to issue their Fan tokens and decided to engage with their existing fan base. They also took advantage of the bull market and got exposure to millions of people who were not aware of the club.
It is currently ranked at #597 (based on Mcap) in the cryptocurrency market. There is a maximum supply of 20 million PSG tokens out of which 3.1 million (16%) are in circulation. PSG is currently listed on Binance, Gate.io, and FTX.
What is the utility of the $PSG?
The world of football, especially in Europe is multibillion-dollar industry. The Clubs jersey itself tends to generate $100 million+ revenue for the club. This indicates that there are fans who are willing to pay just to be part of the team (by wearing the jersey) and this is precisely what PSG has capitalized with the help of Fan tokens.
Owning a PSG token allows you to influence the decisions for the minor decisions for the club. This came in the form of
- Choosing the message on the captain’s armband
- Choosing the BEST Goal of the season
- Choosing the BEST defensive play of the season
- Choosing the BEST skill of the season
- Choosing cover of the game they were featured on.
While PSG has mentioned that the token would buy you influence, it would it only be for minor decisions. The token holders won’t be able to decide the game strategy, the club manager, the salary of the players and what players to add in the squad.
The holders also get the chance to meet their favourite players and access to exclusive merchandise.
Is the cost of $6.22 worth the utility mentioned above? Could be possible, as their most popular merchandise is the club jersey which is worth $120 and there is no utility attached to that piece of clothing except for sentimental value.
Based on the utility mentioned above, the value of the token could rise if more rewards are added to their list of utility. Here is a hypothetical utility, the token holders get to create the club jersey and the community can vote on which becomes the official version. The fans of the clubs might buy more tokens to get more influence on the matter.
It also has the risk of falling significantly, if the rewards are deemed not worth the current price. This is likely as the decisions that the token holders had influence on was not only minor but also insignificant. The Merchandise and the chance to meet the players is a chance. Only a minority will get the chance benefit while the rest wont.
Competition analysis.
As mentioned above $PSG tokens has peers but there not necessary competition. They will only compete to get the attention from the crypto industry, but that exists outside the world of cryptocurrency as well.
Here is some of the peers to $PSG’s fan token
Alpine F1 Team Fan Token has a market capital of $27 million
FC Barcelona Fan Token has a market capital of $16 million
UFC Fan Token has a market capital of $2 million
Media, and community strength.
Although the market capital of the PSG’s Fan token ($19 million) is not even close to the actual value of the football club ($3.2 billion), the media and community strength is also an outlier and most likely beats most of the crypto projects in the world. However, there isn’t any strong correlation between community strength and the price of the token for this Fan token.
PSG has multiple twitter accounts with millions of followers on each of them. The highest following followed account has close to 12 million followers.
Conclusion
Pros: PSG fan token is simple to understand and has potential to becomes the next “hot cake” in terms of merchandise for the multibillion-dollar football club. The utility is also quite simple to understand.
Cons: Token is primarily a tool to monetize their community and to find new fans. Fan tokens cannot be considered as an investment but there is a scope of speculation in the short term. The current utility is worth the cost for a minority within their fan base, while the majority of the fanbase + new fans might not find it attractive.
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