The Football Supporters’ Association (FSA) has called for regulations of cryptocurrency-related platforms after one of sport’s biggest cryptocurrency-brands has gone into liquidation.
The Times has reported that fan engagement platform, IQONIQ, has collapsed in Monaco, which has potentially left thousands of supporters in possession of Fan Tokens ‘worth almost nothing’.
The enterprise had deals with La Liga in Spain, the McLaren Formula One team as well as major football clubs in Europe.
Clubs, sports organisations and fans could now face huge losses in their investments into crypto, as the company’s Chief Executive, Kazim Atilla, stated that ‘millions of IQONIQ tokens were now worth almost nothing’, but declared that it may bounce back.
La Liga’s Real Sociedad has reported that it is owed around £685,000 by IQONIQ, whilst The Premier League’s Crystal Palace has already begun legal action. The Eagles formed a shirtsleeve sponsorship with the company in September 2020 but before launching any promotions, the deal was suspended after what has been reported as a missed payment.
Meanwhile, McLaren has allegedly called its contract with the crypto-firm to a close, whilst Super League rugby club Wigan Warriors informed the outlet that the side was ‘aware of the situation’ regarding its own shirt sponsorship deal with IQONIQ but offered no more insights.
Furthermore, The Times has also shared that popular fellow crypto platform, Socios.com, has contacted the Premier League calling for a code of practice for all cryptocurrency-related partnerships with English top-flight sides.
IQONIQ had previous intentions to grow as a large global platform by 2025, having already had ‘high-profile’ sports partners such as the aforementioned teams and leagues as well as Wigan’s Super League rivals St Helens RFC prior to its liquidation occurred last month.
In a statement, an FSA spokesman told The Times: “FSA members have raised legitimate concerns about cryptocurrency-based engagement partnerships at their clubs, some of which are shared by the Advertising Standards Agency, [which] said promotion of these deals trivialised the dangers around crypto assets.”
Additionally, Atilla also outlined that the enterprise had been greatly affected by COVID-19, but assured that it would pick up from the loss and expand outside of the country, but investigations by The Times have reportedly established that IQONIQ failed to pay sports partners on time resulting in such financial issues.
The news follows a boom of cryptocurrency partnerships in 2021, as the trend continued this week with the Argentine Football Association (AFA) announcing a partnership with crypto-exchange Binance – a deal that led to backlash from Chiliz, a firm that had previously agreed to a token collaboration in the region.