Skip to main content

Barca's mysterious crypto deal points to bigger problem in football

As one of the world’s most prominent sports teams, it’s no surprise that FC Barcelona has dozens of companies lining up to associate with it. Partnerships range from headline sponsors Nike, Spotify and Philips Ambilight to local cava producer Codorníu via toolmaker Stanley and Malaysian lender Maybank.   Those commercial partners get to sell their wares to Barça’s vast fan base and bask in the reflected glamour of the club that gave us Lionel Messi. In return, they get cash.

Earlier this month, Barca made a curious addition to its partnership team sheet: Zero-Knowledge Proof (ZKP). The previously unknown crypto company will be the club’s “official blockchain technology” partner for the next three years.

“This new sponsorship deal, in a cutting-edge area of technology, is yet another example of FC Barcelona’s leadership in the commercial field,” the club said when announcing its ZKP tie-up.

Yet, despite access to Barça’s digital channels and hundreds of millions of fans — there is little publicly available information about ZKP. The company registered in Samoa, appears to have no listed address or public team, no clear disclosures about founding or financing, and minimal digital footprint. ZKP claims it has developed a piece of hardware that lets users verify information without revealing underlying data — a “privacy-first” blockchain/AI protocol. Repeated efforts to contact ZKP have so far been unsuccessful.

“Everyone asks, “Who’s behind this?” the company says on its website. “As if knowing the names would make the code stronger. It won’t. We’re real — engineers, cryptographers, ex-founders, system killers. But we’re not playing the PR game.”

But that secrecy means fans have no idea who they might be dealing with. Criticism of the deal prompted Barcelona to publish a statement on Thursday evening, saying it had “no connection whatsoever” or responsibility for ZKP’s debut coin auction or its associated technology.  Not the greatest endorsement of your latest commercial ally 12 days into a three-year deal.

Football clubs have been dabbling with crypto sponsorships for some time, with pretty mixed results. Clubs including Inter Milan, Chelsea and Atlético Madrid have had to end such deals early, in some cases due to non-payment.

Despite the reputational and financial risks — not to mention the potential brand dilution — such deals keep coming. The money, it appears, is too good to turn down.

It could be argued Barça is a special case. Its vast debt burden makes raising revenue particularly urgent, while its member-owned structure limits some other options — for example, issuing new shares or bringing in major investors. Commercial partnerships remain the most straightforward way to raise cash quickly.

But the need to raise income as quickly as possible is an increasingly common theme across football, and one that could get even more pressing as regulation across Europe ties spending to revenue.

European football doesn't have a great record when it comes to long-term thinking. So long as crypto companies still have money to spend, expect them to find a willing audience in club boardrooms — no matter how opaque they are.

 

Comments

Popular posts from this blog

It's no deal say Spurs insiders over Taiwanese takeover

Senior figures at Tottenham Hotspur insisted on Friday that they had not been informed of any deal to sell Daniel Levy’s stake in the club. A business group, Eight Sports Capital — which is said to include a billionaire Taiwanese financier — claimed that it had an agreement in place to buy a 24.99 per cent stake in ENIC, the club’s majority owners, from Levy, who owns 29.88 per cent. The Times has been told Ng Wing Fai and Brooklyn Earick form part of the group, having both been linked previously to potential takeovers of the Premier League club. The Taiwanese businessman, Richard Tsai, is also said to be part of the consortium. He is reportedly worth £7 billion.  Last year Earick, the former DJ and tech entrepreneur, was part of an attempted £4.5 billion takeover, which was “unequivocally rejected” by Spurs.  An ENIC spokesperson said: “We can confirm that neither ENIC nor THFC are aware of any sale by Daniel Levy’s Family Trust of its minority stake in ENIC, THFC’...

Reports about Charlton sale exaggerated

Reports have appeared in The Guardian and elsewhere that Charlton has been put up for sale. Richard Cawley is an authoritative local journalist who runs a South London Sport substack site.  He reached out to the club yesterday evening to ask for comment on The Guardian’s article. Early indications from the club have been that nothing has changed since the story about them seeking investment, except that it is now a different company doing it. Charlton have since managed to consolidate their place in the Championship, avoiding an instant return to League One, with their women’s side promoted to the WSL, returning to the top flight for the first time since 2007, although staying there is likely to be costly. It would be counter-intuitive for owners Global Football Partners not to progress the club when looking for investment, that the focus remains on driving it forward, that their spend this summer is in line with long-term planning and will see an increase in wages spent on players...

Levy's anomalous status at Spurs

It is now nearly a year since Daniel Levy was dismissed as Tottenham Hotspur chairman by the Lewis family.  It has been 12 months of dramatic twists and turns, with Spurs avoiding relegation on the final day of the Premier League season, and then spending unprecedented sums this summer to try to make sure such a scare never happens again. But while most fans focus on the football — and a dubbing by Brentford   — another set of issues have been bubbling away separately. These relate to Levy’s continued position as a minority shareholder in the club. This has been in the news for much of this summer, even as we approach the first anniversary of Levy’s dismissal, and specifically this month, after he missed the opportunity last week to participate in the Lewis family’s latest equity injection into the club. On Thursday morning the club confirmed that his shareholding has been diluted, down by roughly two per cent, after the creation of new ENIC shares. Levy’s dism...