Could Cryptocurrencies be the Future at Old Trafford?

Cryptocurrencies are on the lips of many in the financial sector but now they are beginning to filter into the world of football. In January, an amateur Turkish club revealed it had become the first football team on the planet to have purchased a player using Bitcoin. Omer Faruk Kiroglu, 22, was snapped up by Harunustasport, who play in Group B of the Sakaraya First Division. The club paid Kiroglu 0.0524 Bitcoins, worth around £384, as well as 2,500 Turkish Lira to seal the deal.

Haldun Sehit, the owner of Harunustasport, told CNN Turk about the PR stunt: “We did it to make a name for ourselves in the country and the world.”

It wasn’t so long ago that United’s rivals, Arsenal, agreed to a deal to become the first professional football team to partner with a cryptocurrency. The Gunners teamed up with CashBet Coin, a digital currency mined exclusively for online casino games, eSports and sports betting. Online sports betting is one of the fastest growing areas associated with cryptocurrencies. Compared with traditional bookmakers, crypto bookies now offer betting markets comparable to the leading high street sportsbooks and often have more competitive odds too.

Bitcoin is now popular in so many B2C sectors. Eateries such as Subway and Starbucks have both allowed their customers to purchase sandwiches and hot beverages using bitcoin for some time. The Starbucks app now integrates with consumers’ bitcoin wallets to pay as quickly as a contactless debit card. You can now use your accrued bitcoin to venture overseas on holiday too. CheapAir.com became the first global travel agency to accept bitcoin payments for flights on all leading airlines. Further afield, Sir Richard Branson’s Virgin Galactic brand, which is selling advanced-purchase seats on flights into space, also accepts bitcoin for commercial spaceflights.

Furthermore, the world’s first cryptocurrency has been launched specifically for fans of football. The London Football Exchange (LFE) was unveiled in January, designed to provide supporters and clubs with a way of exchanging funds without the need for third parties. Football clubs will be encouraged to allow fans to purchase equity in the club via LFE tokens.

Meanwhile, less commercially-focused benefits will also be available such as the ability to purchase club tours, meet the players and secure exclusive discounts on club shop merchandise. The LFE is in the process of liaising with more than 50 professional football clubs around the world, including some in the Premier League. It believes that a global fan base of four billion-plus fans is a huge market for the digital currency. In line with the potential market for the currency, there will be four billion LFE tokens generated for initial sale on Ripple and Stellar at a price of $0.20 per token. This equates to some $350 million, which just over a tenth of the value of the Red Devils, who are still considered the biggest club in the world.

If United was to become involved in LFE, it would not only provide an additional transactional funnel for sales, it would add value to the supporters’ experience. In this digital world that we now live in, a dedicated virtual currency like LFE could build an ecosystem that improves the efficiency of club operations, minimises the threat of fraud to clubs and gives fans a feeling of renewed involvement in their club. But what areas of the club could be revolutionised at Old Trafford via the incorporation of a digital currency like LFE?

Season and match ticket sales

In February, a New England Patriots fan purchased Super Bowl tickets on the 50-yard line using 2.2 bitcoins. For fans that might not have fiat currency in their account to purchase tickets for the next big Champions League game, but have plenty of bitcoin, they could use their bitcoin wallet to make an instant and highly secure transaction of a seat at Old Trafford. This could also apply to season tickets, which would save considerable paperwork and costs for the club to third-party financial operators.

Match programmes

There’s no doubt that matchday programmes are waning in popularity. But by making them truly digital, United fans could purchase a digital copy of the magazine with a tap of their smartphone at the turnstile, which would take a specified amount of bitcoin out of their wallet at the same time.

In-ground food and beverages

It’s a similar case for the club’s catering inside Old Trafford. Queues could be kept to a minimum with no need to exchange cash at the tills, with fans able to pay for their pre-match pie or pint by tapping their smartphone device like a contactless card. This would release the funds from a bitcoin wallet instantaneously.

Investment at Academy level

One novel way a digital currency such as LFE could be used at Old Trafford is through supporter investment in the United Academy. Fans could sponsor young players at all age groups, giving them the best possible chance of progressing to the first team. The overall LFE investment in United’s Academy could pay for youth team transportation to games and even team kits, creating a self-sufficient Academy model that requires no outside investment. The fans would feel like they are investing in the long-term future of the club.

Player transfers or contract bonuses

As evidenced by the transfer in Turkey, clubs are already weighing up the pros and cons of purchasing players in alternative currencies. Bitcoin transactions are ultra-secure, protected against the threat of fraud by blockchain technology. When clubs such as United are dealing with nine-figure transfer fees, blockchain could be a huge benefit. Cryptocurrency payments would also be beneficial on transfer deadline day when transactions need to be made with haste to beat the deadline. It could also be written in the contracts of players that they receive bonuses in the form of cryptocurrencies, as the proliferation of digital currencies continues worldwide.

One thing is for sure, as a global sports brand, United will want to be seen as the trend-setters for fintech in sport. Arsenal’s deal merely scratches the surface of what’s possible with cryptocurrencies in football and it will take a club of the Reds’ scale to determine its long-term viability.