Argentina’s economic restrictions have reached the sports industry, with the first signing of a local soccer player with cryptocurrencies making national headlines.
The transfer of midfielder Giuliano Galoppo from Banfield’s Athletic Club to Sao Paulo Futebol Clube was made in USD Coin (USDC), exceeding $6 million and up to $8 million depending on the volatility of the Argentine peso exchange rate, according to local sources. The transfer was made possible through a collaboration with Mexican crypto exchange Bitso.
“We are very proud to work with these two clubs for this historic signing of Sao Paulo with all the security, transparency and flexibility that the crypto-economy has to offer,” said Thales Freitas, director of Bitso in Brazil.
The transfer happened in a difficult economic situation for Argentine sports clubs. The reported exchange differential between the pesos and the dollars maintains escalationaffecting the possibility of football players being signed by international teams and encouraging them to renegotiate their contracts to adjust their salaries to the volatile price of the dollar.
The country’s unstable economy has led to a major adoption of cryptocurrencies, especially stablecoins. Stablecoin trend notoriously intensified post-shock Argentina’s economy minister resigns earlier this month.
The practice of adopting cryptography has also been reproduced in sport by players and clubs in the country. However, it would be the first time that clubs could accept cryptocurrencies as a form of payment for international transfers to regain a competitive edge in the market for their players.
Despite its novelty, the cryptocurrency transaction involving Galoppo will still be subject to regulation. According to Bloomberg, Argentinian central bank sources clarified that the transfer of Galoppo is an export transaction. As a result, Banfield will be forced to liquidate its USDC in local currency, the peso, using the official foreign exchange market.
On the other hand, it is still unclear how the professional footballer chooses to directly exchange USDC on the official exchange market while allowing the club to resist the measures of the central bank.
A recent study by Big Four accounting firm Deloitte revealed the potential of the crypto ecosystem in redefining revenue streams and fan engagement in the sports industry.
The report predicts that crypto will create a nexus “around sports collectibles, ticketing, betting and gaming.” For example, with non-fungible tokens (NFT)the sports industry may introduce initiatives around timeshare, which could trigger the reinvention of the ticket resale process.