By Nidhi Bhardwaj: Argentina's shocking 2-1 loss to Saudi Arabia in the ongoing FIFA World Cup on Tuesday caused the price of ARG tokens to drop by 30 percent, illustrating the influence of sports on the value of tokens linked to such teams. Due to the poor performance of the Lionel Messi-led soccer team, the ARG token's price dropped to $4.96 percent by the end of the game from $7.21 at the start.
At the time of writing, the current ARG (Argentine Football Association Fan Token) price is valued at $5.22, with its overall value down by 26.51 percent in the last 24 hours, as per CoinMarketCap.
ARG tokens are developed on the Chiliz blockchain by Socios.com in partnership with soccer teams, much like other digital crypto tokens. They give buyers access to benefits and a say in some choices made by sponsored teams. They operate similarly to other cryptocurrencies and are sold on exchanges like OKX. Investors may wager on the performance of their preferred team, but this does not give them ownership.
Fans may lose money as a result of their value fluctuating significantly, especially now that the wider cryptocurrency market is still reeling from the financial collapse of the crypto exchange FTX earlier this month.
The world's top football clubs, including FC Barcelona, Manchester City FC, and Paris Saint-Germain F.C., as well as other national teams, showed increasing interest in working with Bitci and Socios.com to create fan tokens last year. These tokens are overly lauded for being the new source of revenue, which has inspired millions of dollars.
Several fan tokens associated with national teams have seen a sharp decline in value as the FIFA World Cup got underway this week. On Tuesday, the Spain National Fan Token dropped approximately 7 percent to $0.7386, while the Brazil National Football Team Fan Token, developed in collaboration with Bitci, dropped about 10 percent to $0.7386. On Tuesday, the cost of the Chiliz blockchain's main token dropped by nearly 4 percent to $0.1839.
Football Fan Tokens have cratered over the past 3 days as the FIFA World Cup 2022 Begins:
Chilis / $CHZ: -21%
Argentina / $ARG: -17%
Portugal / $POR: -17%
Brazil / $BFT: -21%
Spain / $SNFT: -31%
Peru / $FPFT: -26%
The index (FOOTBALL) is down 21% over the period. pic.twitter.com/y7tb72R3Et
What happened to Saudi Arabia after the victory?
The victory of Saudi Arabia saw a change in the NFT market, while Argentina suffered a loss. Given that it has no connection to the football team, the July-launched Ethereum NFT collection called Saudis noticed a spike.
JUST IN: @TheSaudisNFT collection saw a 23.6% spike in floor price following the country's surprise 2-1 win against Argentina at the #FIFAWorldCup2022.
📈: https://t.co/zR0YclkjbC pic.twitter.com/UIlD00F53M
Views on the affected token price
"Big events often present big opportunities for traders," Priyansh Patel of Delphi Digital, speaking to Coindesk, wrote on Monday. "Some market participants begin positioning a few weeks before the actual event in order to take profits when the event occurs." The World Cup, he wrote, was no exception, and fan tokens "experienced hefty corrections just two days before the event began,” as per Coin Desk.
"The more tokens a fan holds, and the more they vote, the higher the clout rating of that fan, moving them upwards through different reward tiers until they have access to the biggest VIP benefits that are on offer," the Chiliz website reads.
