When a question was posed to Liverpool earlier this month via the club’s official Discord server about why it had not published its sale of non-fungible tokens (NFTs) by blitzing social media channels and potentially reaching as many as 20 million followers, a quiet admittance was offered in the reply.
“Unfortunately, we have to be very cautious about how much we tag the main account,” wrote Drew Crisp, who fronted the controversial decision to enter the NFT business from his position at Liverpool as the loftily-titled senior vice president of digital platforms.
“Not everyone is as positive about this venture and managing our channels is a balancing act given by the broader fanbase and commercial partners,” he concluded.
Prior to the launch, a statement from Liverpool attempted “to make clear to supporters that its NFTs are digital works of art and should not be considered investments”.
The warning, however, was largely lost before it made its way onto the same Discord server because across the social media type messaging app, which is very popular among crypto communities, the talk was initially full of hype, with users referring directly to their newly purchased NFTs as “investments” albeit with no sign of temperance from club moderators pushing back on such suggestions.
Three weeks later, the mood has changed, with some holders on the server annoyed that there doesn’t appear to be a proper “roadmap” for what the NFTs entitle them to. This comes after it was revealed that 94 per cent of the stock was left unsold from an auction at Sotheby’s.
Crisp is from the Cambridge area and joined Liverpool in 2019 after 15 years at IBM, where he was an executive partner. The new role, according to his Linkedin page, is to “drive a deeper and more fulfilling fan and partner engagement through relevant digital products and content, and to help our partners activate their brands through LFC’s fanbase”.
An even more highly compensated executive inside Liverpool’s business office had noted with enthusiasm the potential of NFTs longer than a year ago. Internally, the question was asked whether a football club could make easy money out of it and the answer was yes. Could Liverpool be among the first from the Premier League? Perhaps…
With that, responsibilities filtered down but in the early stages of the process that followed, nobody truly scrutinized whether this was a fanbase willing to embrace a fire sale. Those with a greater understanding of the city, the club and its supporters would no doubt have warned of the potential pitfalls had meaningful consultation happened before it was far too late.
Instead, Liverpool grabbed at the low-hanging fruit because of the supposed rewards of leading the market. There are articles elsewhere on this platform that detail the contentions around NFTs, along with cryptocurrencies and the darker reasons they are suddenly interested in football investment. Last week, it was revealed by The Athletic that Liverpool are in conversation with at least one company from the cryptocurrency sector in relation to a record-breaking shirt sponsorship deal.
Sources at Liverpool suggest the club would not be acting responsibly if it did not explore both the benefits and drawbacks of such potential relationships. Reliably, the same reasoning appears, and this relates to the consequences of competing with opponents in possession of unlimited funds. Ultimately, it is argued, Fenway Sports Group has proven, so far, that self-sufficiency can work but only because of an aggressive approach to establishing new revenue streams. Without this, there would be less money for Jurgen Klopp to spend on the team after he extended his own stay on Merseyside by two years on the same terms he was on previously.
If the landscape was weighed more in Liverpool’s favor, however, would those who seek deals on FSG’s behalf only agree to ones that do not affect the club’s reputation because of grubby associations? Perhaps the argument would then switch to keeping the team ahead of a chasing pack and the FSG could then ask whether supporters would be willing to cede some success for cleaner ethics with commercial partners.
After all, there was no uproar when the current shirt sponsor Standard Chartered took over in the summer of 2010 as the club teetered towards a great financial void under a different owner. At the time, it rather simply felt like a strange alignment, not least because the bank was Asian-focused and did not have a presence on the high street in the UK.
While Liverpool would offer greater visibility because of its global popularity, the club’s image also offered credibility for a financial service under the microscope of the highest authorities. That deal was struck by then-financial director Ian Ayre even though the bank, five years earlier, had signed an agreement with the United States Federal Reserve and a New York regulator which specified the changes it must make to its procedures to comply with anti -money laundering laws.
Nobody seemed to mind either when Liverpool subsequently signed two extensions with Standard Chartered even though a cease and desist order in 2012 disclosed that the bank’s New York branch deliberately circumnavigated US sanctions between at least 2001 and early 2007, some of which were against Iran – a transgression that cost the company $ 670 million in regulatory fines.
This was before another round of fines totaling $ 1.1 billion (£ 842 million) to US and UK authorities in 2019 – the year after the bank’s last shirt sponsorship deal with Liverpool was announced. On Wednesday night, meanwhile, a leafleting campaign outside Anfield ahead of the Champions League semi-final first leg targeted the bank but not for its historical indirections. Fossil Free LFC shines a light instead on the company’s relationship with climate change through loans to some of the world’s largest coal, oil and gas producers. “They pay £ 40 million a year to use our club to clean their name,” the leaflet claimed.
Liverpool have their own in-house initiative, the Red Way, which in February came together top in the 2021 Sports Positive Environmental Sustainability League. This, however, did not include an assessment of the club’s commercial partners or their relationships with other companies.
From here, if Liverpool were to team up with a crypto company, they would not be the first football club to enter an agreement of such significance and therefore any signposting could not be described necessarily as ground-breaking even if they wanted to.
Earlier this month, Crawley Town was taken over by a group of investors from the industry. Although American sport and motor racing have already brokered sponsorship deals, it has largely gone unnoticed in the Premier League that Watford’s sleeve sponsor is Dogecoin, the cryptocurrency.
With less visibility and noise, a majority of the clubs in England’s top flight have already been able to enter technical and / or strategic partnerships with cryptocurrencies. There are also nine clubs in the Premier League that promote betting on their shirts.
There is a danger of slipping into whataboutery in this discussion, but you get the picture: it is not as if Liverpool are acting alone. It will, for example, be interesting to see whether Arsenal continue to promote tourism in Rwanda on the sleeves of its shirts for £ 10 million a year after the country signed an agreement with Boris Johnson’s Conservative government to essentially intern refugees trying to enter Britain.
Liverpool’s NFT debacle has not stopped other clubs from trying to succeed where they have failed. Only on Wednesday, Trabzonspor – looking to capitalize on what could be their first Turkish title in 38 years – launched their own NFT “feast” through a South Korean firm that has designed a range of collections at roughly the same price as the ones originating on Merseyside.
The problem for Liverpool is the image of the club wishes to project – one primed to promote the notion that “we are Liverpool, this means more”. Even if the move into the world of NFTs had proved successful financially, did anyone involved ever stop to consider whether they were watering down a famous brand? Alternatively, if they decide to align with crypto, might it make the institution they represent seem phoney?
(Top photo: Andrew Powell / Liverpool FC via Getty Images)