A FOOTBALL finance expert has cast doubt over the takeover of a club by an NFT investment group.

Crawley Town Football Club were taken over on Thursday after Ziya Eren's shares were sold to Wagmi United LLC, which is a branch of the non-fungible token (NFT) Wagmi.

An NFT is a "digital asset that represents real-world objects like art, music, in-game items and videos" - they are bought and sold online and are non-interchangeable.

They use the same kind of programming as cryptocurrency, like Bitcoin, but cannot be exchanged for one another.

The Argus: Kieran Maguire has been involved in financial education since 1989 and regularly speaks on all things finance in football under his brand The Price of FootballKieran Maguire has been involved in financial education since 1989 and regularly speaks on all things finance in football under his brand The Price of Football

 

The investment group tried to purchase League Two Bradford City in December 2021, but current owner Stefan Rupp declined the offer.

It "seeks to reimagine how professional sports teams are owned and operated".

The American-owned group wants to create a new model of sports club ownership with the ultimate goal of getting Crawley Town to the Premier League.

Kieran Maguire, who specialises in accountancy in football, said while the move could harness the "power of the crowd" it is still a risk.

The 60-year-old pointed towards Liverpool failing to sell 95 per cent of its recently launched "LFC Heroes Club" NFTs, John Terry's NFT collection which fell in value by 90 per cent last month, as well as the Paris Saint Germain "fan token".

He told The Argus: "It's a highly volatile, unregulated and easily manipulated market. If you want to buy into it in those circumstances then good luck to you is my view.

"There is nothing wrong with new people coming in, if they want to engage with fans that is great.

"If engagement means you have to buy fan tokens, I think they said you can vote in the new directors.

"But if something sounds too good to be true, it generally, in my experience, tends not to be true.

The Argus: One NFT for Mohamed Salah was auctioned for more than $80,000 before Liverpool stopped selling their NFTsOne NFT for Mohamed Salah was auctioned for more than $80,000 before Liverpool stopped selling their NFTs

"That's the reservation, what exactly do you have to do? How many tokens do you need to buy before you can influence the board of directors? Also what on earth are you doing trying to influence who the board of directors are?

"When I go into Sainsbury's to buy a loaf of bread, I don't think 'it should be a bit better here, I want to change the board of directors,' I don't know anything about running a grocery store and I don't know anything about running a football club.

"So I do think letting people loose with a series of tokens does seem a strange way to run a business. You want professionals in charge, not people who own digital cartoons.

The Argus: Previous owner Ziya Eren sold his shares in the club on Thursday, April 7Previous owner Ziya Eren sold his shares in the club on Thursday, April 7

"How else is it going to be done other than people buying tokens in the club?

"I wish Crawley all the best, it's a local club in Sussex and we would love them to do well. Looking at the finances in the past, it's a club which isn't over ambitious. It tries to live within its means, even so it has run up losses quite regularly."

Kieran Maguire said that he thinks the takeover may be marketed as the "first and only club" to be run in this way to attract people around the world.

He added: "That means people around the world who think crypto and NFTs are the greatest thing since sliced bread. They aren't necessarily interested in football, but what you may be able to do is use the power of the crowd.

"Could you sell extra merchandise off the back of this? Potentially you could. Could you sell NFTs because it is an NFT-owned club? One concern is if other clubs start following that lead, are people more likely to buy an NFT in Manchester United or Crawley Town?"

The new owners will be contacting season ticket holders and sponsors to outline their plans for the future. There will also be further announcements going into the summer.