In this post:
- As a new social media trend gains traction, Chiliz, the primary advocate for fan tokens, has noticed a surge in activity.
- With the addition of new utility and point-farming games, trading activity for other fan tokens also rose.
- With DEX and a prediction market, Chiliz is expanding its DeFi industry.
A brand-new token class is preparing for a possible boom. Football team-related fan tokens link the meme asset concept to pre-existing fandoms.
One of the emerging trends in cryptocurrency is fan tokens, which are assets associated with well-known football teams. Analysts believe this represents a shift to a new class of assets, as trading activity for the token category surged from baseline levels.
Fan tokens have become an underappreciated source of growth after years of getting little attention. They begin with a market capitalization of less than $300 million, considerably behind the meme market.
Several popular fan tokens experienced 10X increases in trade volume during the last week, reaching $500M in a single day. The majority of popular tokens also saw brief price increases.
Why are fan tokens becoming popular again?
In the summer of 2024, during the Euro Cup, fan tokens gained notoriety. But in December, the Chiliz ecosystem redoubled its efforts to increase acceptance by including new apps.
In order to create a SportFi sector based on pre-existing fan tokens, the project redesigned its tokenomics and increased the CHZ supply. Additionally, Chiliz targeted existing fan token users by adding a merch layer and other benefits.
Chiliz embarked on a social media drive to add more sports enthusiasts to the chain after years of sluggish growth. To pique sports fans’ interest again, it uses points mining, airdrops, and prizes. Crypto insiders, who supplied the higher trade volumes, are also becoming interested in the expanding token activity.
Another alternative to celebrity assets, which frequently experience fleeting fame before fading into obscurity, is fan tokens. These sports-themed tokens, in contrast, are less thrilling and less vulnerable to aggressive pumps and rug pulls.
With a dedicated launchpad, Binance initiated the trend of sports fan tokens
Through a special launchpad, Binance actively promoted the issuing of fan tokens. It supported a number of tokens, including ALPINE, PORTO, SANTOS, and LAZIO. Although most of the activities were phased out in the last few months, the exchange Binance Fan Tokens was also committed to increasing utility and planning events for those assets.
The Chiliz ecosystem, a long-running blockchain devoted to sports fandom merchandise, is used by other assets.
At first, sports tokens were a rather specialized ecosystem designed to make team and fan activity easier. Fan tokens aided in community development, fundraising, rewards, and the unlocking of several privilege tiers. They can also be spent on NFT marketplaces or used to vote.
Beyond their immediate utility, fan tokens are simply responding to hype, aiming to pump their still relatively low market capitalization. Still, they hold an advantage over memes – a long-running history, an identity, and limited incentives to rug pull. Their low volumes make them volatile, but they also have a higher potential upside during rallies.
The environment of Chili seeks to recover
Chiliz (CHZ) saw a 100% increase in value from $0.06 to $0.12 due to the recent altcoin surge. Additionally, CHZ is beginning to regain its trading volume. The usage of Socios and its list of fan tokens might also increase with a more vibrant Chiliz ecosystem. Since 2019, these assets have existed in varying degrees of adoption.
During the bad market and disenchantment of 2022, fan tokens also suffered because many clubs stopped caring about them. However, there is now more demand due to the present bull market and new Web3 technology.
With a sharp increase in activity at the end of November, search statistics already show the revived interest in memes and altcoins.
The developing DeFi ecosystem in Chiliz is another element attracting visitors. With the Azuro prediction market and the developing DEX, Chiliz has just $16.68M in value locked. Fan tokens currently only play a theoretical part in DeFi, but they are comparatively dependable assets that can be added to other pools.
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