Fan Tokens: Sports and Speculation on the Blockchain

46 Pages Posted: 27 Dec 2021 Last revised: 2 May 2022

See all articles by Matthias Scharnowski

Matthias Scharnowski

affiliation not provided to SSRN

Stefan Scharnowski

University of Mannheim

Lukas Zimmermann

University of Mannheim

Date Written: December 23, 2021

Abstract

This paper provides an economic analysis of fan tokens, which are collectible utility tokens issued by sports clubs. We document that fan token prices are highly volatile and substantially riskier than those of established cryptocurrencies. For a subset of publicly listed clubs, we find that stock and token returns are uncorrelated. Instead, fan tokens tend to closely co-move with each other and the main cryptocurrencies used for buying them. Returns are lower on days when the club unexpectedly loses a game, but higher on days of increased investor attention towards fan tokens. The results suggest that while fan tokens may provide some non-monetary utility, as financial assets they are highly speculative and in many aspects resemble cryptocurrencies.

Keywords: Fan tokens, Cryptocurrency, Soccer

JEL Classification: G12, G14, G15, G41, Z23

Suggested Citation

Scharnowski, Matthias and Scharnowski, Stefan and Zimmermann, Lukas, Fan Tokens: Sports and Speculation on the Blockchain (December 23, 2021). Available at SSRN: https://ssrn.com/abstract=3992430 or http://dx.doi.org/10.2139/ssrn.3992430

Matthias Scharnowski

affiliation not provided to SSRN

Stefan Scharnowski (Contact Author)

University of Mannheim ( email )

Mannheim, 68161
Germany

Lukas Zimmermann

University of Mannheim ( email )

Mannheim, 68131
Germany

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