Spain National Fan Token Plummets 20% Despite UEFA Euro 2024 Victory

Anticipatory gains followed by post-tournament drops are common in fan token markets.

Spain's jubilant celebration of their UEFA Euro 2024 soccer championship win contrasts sharply with the market performance of their official cryptocurrency, the Spain National Fan Token (SNFT), which has taken a steep dive.

Following Spain's triumph over England in the UEFA finals on Sunday, securing a historic fourth European Championship title, the SNFT token has plunged by 20%, now trading at $0.024. At the time of writing, its market capitalization stands at $565,000, as reported by CoinGecko. In contrast, other prominent fan tokens, such as those of Paris Saint-Germain and FC Barcelona, saw a modest increase of 2% to 4%, buoyed by an uptick in Bitcoin’s value.

Launched in 2021 through a collaboration between the Royal Spanish Football Federation and the Turkish blockchain platform Bitci, the SNFT token aims to boost fan engagement and offer exclusive experiences for supporters and investors.

The recent decline in SNFT’s value is likely due to a "sell-the-fact" reaction from the market. The token experienced a surge of over 70% in the three days leading up to the final, reaching $0.03845. This phenomenon, known as "buy the rumor, sell the fact," is typical in the fan token market, as observed during the 2022 FIFA World Cup.

Research on the correlation between fan tokens and team performance presents a divided view. A 2022 study by Mieszko Mazur and Miguel Vega found that team performance does not significantly impact fan token values, which remain volatile regardless of tournament outcomes. The study highlighted that while fan tokens might enjoy a high initial trading return of 150%, they tend to underperform major cryptocurrencies like Bitcoin and decentralized finance (DeFi) coins in the long run.

Conversely, other research suggests that high-profile tournaments such as the Champions League can influence fan token values more significantly due to the broader audience and the prestige of the event compared to regional leagues.

The dip in SNFT’s value post-victory reflects a broader trend in the fan token market, where excitement leading up to major events drives prices up, only to see them fall once the event concludes. Despite this volatility, fan tokens continue to be a unique tool for enhancing fan engagement and offering exclusive benefits to supporters.

Photo Source / Blockonome