Fan engagement or a crypto con...?

Arsenal's new $AFC scheme raises many questions...

Before I became a news and sports journalist I worked for Investment Banks in The City, Canary Wharf and in Sydney, Australia. I also have an MBA.

Which means I can decipher a balance sheet. And decode financial issues when required. Like today.

……………………………

So, there it was this morning, brazen as you like.

‘We are delighted to announce a new partnership that will bring fans closer to the club through a series of fun, interactive polls, games, competitions and quizzes every season,” Arsenal said in a breezy statement.

“Our partnership with Chiliz, the leading global blockchain providers for the sports and entertainment industry, will see the launch an $AFC Fan Token on the Socios.com app.

“There will be countless engagement opportunities on Socios.com for $AFC Fan Token holders, including the chance to influence the club in a series of interactive polls across a variety of decisions every season.”

I’m sorry? Did I read all of that right?

So, I looked into it further myself, bolstered with a few links others had sent me, including how this scheme is doing under the Dildo Brothers at West Ham.

Because it isn’t about supporters engagement at all. This tie-up is about maximising monetisation, pure and simple.

While you could argue, well why not? It’s a free market and anything goes in the world of capitalism.

Echoes of a Ponzi scheme

But not for a club of Arsenal’s stature. Surely? For this has the potential to turn into a Ponzi scheme, if not fully regulated and administered. (There is no suggestion it will).

They’re marketing it as ensuring fans have a ‘say’ at Arsenal via trading Socios own cryptocurrency called Chiliz.

But what do loyal supporters get for their money? To vote on man of the match. To vote on a new ‘theme’ tune?

Yet, the votes are based on topics of marginal interest. You certainly wouldn’t get near having a vote on anything important, such as, say, your take on a new European Super League.

Although, perhaps, if clubs such as Arsenal under the Kroenke’s actually took time out to listen to loyal supporters back in April, they wouldn’t have been so humiliated during their subsequent climbdown.

Far from a joke

While some demanding the removal of the infernal ‘Sweet Caroline’ might have a point - with one person tweeting me earlier that it was a price they were happy to pay, in all seriousness this scheme is far from a joke.

It’s a ruse marketed as having a ‘say’ in Arsenal. For this you buy tokens, bought and sold - traded in other words - via Socios own cryptocurrency.

And for trading read gambling, for all that entails. You might as well buy pork belly futures. Or Dutch Tulip Bulbs.

Of course the price will rise for Socios as a firm, as they are now associated with a strong ‘brand’ (how I hate that word when applied to sport).

So it follows that those associated with the company will make money if the price goes up.

But that’s the essence of the scheme.

If the price rises, they do well.

If the price falls, and you’re fully loaded at a high offer price, then it will be YOU that loses. It’s the essence of share ownership.

Only in May the value of the most well-known cryptocurrency plunged by nearly 30% after a massive rise in value.

What you need to know - the pro’s

Bitcoin is the world’s most popular digital currency. It allows people to bypass banks and traditional payment methods and is not controlled by any single entity, country or central bank. There are more than 18m bitcoins in existence.

Proponents believe bitcoin could eventually replace government-issued currencies thanks to the growing popularity of digital payments. Others also say it is protected from manipulation by governments and central banks, offering a more democratic payment system.

While many investors believe it can provide a hedge against inflation.

Crytptocurrency ‘cons’

Those against it insist bitcoin has no intrinsic value. They claim it poses a risk for investors - because they are not protected by regulators or financial protection schemes if the asset tanks. I would be very interested to learn if $AFC investors are covered in any way.

Critics also warn investors could be exposing themselves to fraud, since cryptocurrencies such as bitcoin have been linked to money laundering and black market dealing.

(Again, it has to be said there is no suggestion that this is what is happening with $AFC or Socios in any way whatsoever.)

But there are also concerns about the environmental impact of bitcoin “mining”, which requires energy-intensive computers to generate coins.

Is this what Arsenal has come to?

And let’s not forget, if fan engagement is so important, the club has 17m Twitter followers.

Why not simply post a poll asking any questions you want?

There would probably be more responses than voters in a by-election. And then you’ve got a wide sample to satisfactorily fulfil the answer to any question posed. But it’s about far more than that.

Data Grab

As someone also mentioned to me, it’s a pure data grab. The club wants improved surveillance over our habits and tastes. It’s a datagrab disguised as collectible digital tokens exchanged for the '‘new third kit warming down snood…”

Don’t forget fans of other teams can still vote in Arsenal polls

The thing with free market capitalism is that, well, it’s free to enter.

Not in terms of financially free, as we all know there’s no such thing as a free lunch.

But, in terms of no barriers to entry. Or very few. Meaning in this specific case, Spurs fans could buy a shedload and then vote Shkodran Mustafi as the club’s greatest ever player.

The final, above point might be lighthearted, but the conceit that this project is building a community of like-minded Arsenal fans is inherently flawed - because any fan of any team can buy $AFC if they really want to.

Though heaven knows anyone would want to.

@laythy29

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