Sports tokens falter: UEFA Euro 2024's start sees fan tokens drop by 13%
Quick Take
- Since the UEFA European Football Championship began on June 15, The Block’s Sports Token Index has significantly declined.
- The following is an excerpt from The Block’s Data and Insights newsletter.
The UEFA European Football Championship kickstarted its 2024 tournament on June 15, igniting a wave of excitement among football fans worldwide. At face value, one would assume that sports-related crypto tokens, especially those tied to football, would perform admirably in light of this once-every-four-years event. However, the reality has been quite the opposite.
The Block’s Sports Token Index, which tracks the performance of fan tokens from notable European football teams, has been one of the worst-performing baskets of assets in the market this week.
Since the tournament began on June 15, the index has significantly declined, with the cumulative market capitalization of these tokens dropping by ~12.8% at the time of writing. During the same period, BTC's price has decreased by 3%, while ETH's price has increased by roughly 1%.
This negative performance can partly be attributed to unfavorable broader market conditions. Compared to the drawdowns experienced by BTC, however, the sports token index has underperformed three times worse to the downside. This stark contrast highlights the particular vulnerability of these fan tokens amidst the current market downturn.
RELATED INDICES
It’s worth noting the fan tokens in this index represent individual football clubs rather than international sporting federations. Even so, one might have expected these tokens to show some semblance of relative strength during a major football event. After all, the UEFA European Championship is a prime time for football enthusiasts to rally around their favorite teams, which should, in theory, bolster the value of related fan tokens.
Yet, this has not been the case. The anticipated boost from the tournament has failed to materialize. The broader implications of this trend are worth considering. If major sporting events cannot reliably drive up the value of related crypto assets, it calls into question fan tokens' overall utility and investment potential. As these tokens continue to struggle, it becomes increasingly important for issuers and investors to reassess their strategies and expectations.
This is an excerpt from The Block's Data & Insights newsletter. Dig into the numbers making up the industry’s most thought-provoking trends.
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