The Political Economy of Football V2

The chief UK financial regulator has warned Premier League football clubs they could face legal action over “questionable sponsorship deals” with crypto companies that are not authorised to operate in Britain. The Financial Conduct Authority has written a letter to Premier League men’s clubs stating they risk enforcement action by taking sponsorship money from crypto and trading companies that are not permitted to offer services in the UK. Crypto companies have become prolific sponsors of top-tier teams in recent years as they seek to tap into the millions of football supporters and encourage them to trade digital tokens.  The FCA said it had seen “an increase in football club partnerships with unauthorised firms, some of which appear to be operating unlawfully”. In the letter, Fiona Mackinnon-Miller, head of the FCA department overseeing scams, promotions and consumer investments, warned that such deals “risk conferring legitimacy on these firms and may expose UK consumers to ...

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 —...

Relegation threatened Crawley Town supporters have demanded changes at the top at their club:  https://www.ctfcsa.co.uk/2023/statement-17-april-2023/ In one of the stranger episodes of recent times Crawley Town were purchased by crypto sports company WAGMI United who talked about Premier League football and how Web3 would innovate in football. Or something.

Liverpool are in talks over a new shirt sponsorship deal as their £40 million-a-year contract with Standard Chartered is set to expire in May 2023. And although discussions are continuing about extending their partnership, the club are also talking to firms from sectors including electronics, media and tourism. Among those parties,  The Athletic  has revealed, are companies from the cryptocurrency sector. They include a crypto exchange firm — a platform to buy and sell digital currency — and a blockchain platform (a decentralised computer network that underpins cryptocurrencies). Many English top-flight sides have signed deals with cryptocurrency firms over the past few years but displaying such companies on the front of their shirts would be a Premier League first. It is likely to be controversial but Liverpool are desperate to financially compete with other elite clubs and maximise their commercial deals. There are a lot of environmental concerns about blockchains, whi...

Financial Times columnist Chris Cook has launched an onslaught on the bromance of football clubs with crypto, saying that it is time they stopped playing with it. Football author Martin Callandine told the Pink 'Un: 'fans outsource some of their judgement to their team's commercial department.  And that's dangerous when clubs are endorsing unregulated products with no consumer protection.'   Terms like 'investment' and 'trading' are used in relation to crypto, but with none of the normally safeguards that apply to them. Last November Manchester City signed a marketing partnership with crypto company 3Key.  This was justified by the usual marketing patter, but a week later City said that the partnership was suspended while they conducted further inquiries (which they should surely have made in the first place). Southampton has been promoting learn-crypto.com, a site aimed at beginners.   My general view is that if sounds too good to be true it probabl...

A number of clubs have got involved with cryptoassets, seeing a new way of making money, but the Advertising Standards Authority has ruled against Arsenal over adverts on 'fan tokens':  https://www.theguardian.com/media/2021/dec/22/arsenal-adverts-for-cryptocurrency-fan-tokens-banned The adverts have been banned for taking advantage of fans' inexperience on cryptocurrencies.   Full ruling here:  https://www.asa.org.uk/rulings/arsenal-football-club-plc-a21-1121873-arsenal-football-club-plc.html The ruling could have big implications in a league which is deepening ties with Socios, with Crystal Palace recently becoming the sixth Premier League club to sign up after Arsenal, Aston Villa, Everton, Leeds and Manchester City, despite fierce opposition from fans’ groups. Earlier this year in a special investigation,  The Athletic  revealed how alongside “fan engagement” in the form of polls and competitions, the Socios ecosyste...

A good general principle is that if you don't understand an investment, you shouldn't buy it. However, what appear to be 'get rich quick' schemes can always attract subscribers, although if the returns appear to be too good to true, they often are. Levels of financial education are not generally high. However, if a brand you trust offers something, you may be tempted. That is particularly the case when it is something you identify with as strongly as a football club. 18 to 45 year old individuals that are affluent or emerging affluent and attend matches at top clubs are attracted by novel forms of investment. Football clubs themselves are often attracted to risky products because they offer an apparent means of boosting financial returns. Although one shouldn't make too much of one week's trading markets are currently in a volatile state, enhanced by geopolitical tensions, not least those between the United States and China. In recent years, a number of ...