Two English Premier League football teams are trying to dodge financial issues by planning a crowdfunding round with cryptocurrencies, reports The Times on September 15.
According to the report, Cardiff City and Newcastle United are in talks with a micro-financing and crowdfunding company, SportyCo to launch their own cryptocurrencies in order to “raise funds to boost their hopes of Premier League survival.” Teams are hoping that Initial Coin Offering (ICO) will enable the fans and investors to buy their tokens for future return and will help the teams by providing an additional source of revenue.
SportyCo, has a successful track record of generating good revenues via crowdfunding, earlier partnering with Avaí Futebol Clube they raised $20 million from selling AVAI tokens. They are also one of the principal sponsors of the world’s leading football team, Espanyol.
Although the details are not clear, this partnership is expected to enable the sale of private digital tokens in form of either security or utilities. The buyer here will either gain a certain amount of stake in the club’s revenue or will receive extra benefits while making a game-related purchase.
Both the clubs are going through a rough financial stage and struggling to survive with lower budgets. As Newcastle earlier suffered some losses as a result of bad managerial decisions, taken by Mike Ashley the club owner. And Cardiff City club owes a sum of $150 million to a Malaysian investor, Vincent Tan.
To get some relief Cardiff City also tried cutting on their wage bill to £20.6 million, which is 18% lower than the previous years budget.
Commenting on the agenda behind their crowdfunding efforts Marki Filej, SportyCo’s co-founder said, “Money raised from the crowd sale goes straight into club infrastructure which will stay with the club forever…With this initial money offer, we are opening a new chapter in football and the sports industry in general.”