What is Chiliz and the CHZ token?
The Chiliz token was developed to set up a mechanism to promote and enhance connections between top athletes and their fans.
Consequently, Chiliz is attempting to address some problems that currently exist in this market:
- For now a team’s fans can only interact with it by buying match-watching tickets or merchandise such as jerseys. For example, it is not possible for them to have a say in the strategic choices that should be made.
- Only a small portion of football clubs are publically traded so that fans can buy stocks of their favorite team (Olympique Lyon, Manchester United, BVB Dortmund, Juventus Turin are rare exceptions of publically traded football clubs).
Using Chiliz, each fan will be able to buy, according to his budget, a certain number of tokens related to his favorite team by using the Chiliz infrastructure, each token corresponding to a fraction of the share of the stock of token emitted by the company. Then in proportion to the number of tokens held, all fans will be able to have their say. They will be micro-shareholders, in a way.
IMPORTANT: There is though a big difference between a shareholder and a token holder. Shareholders have a say in the economical strategy of the club – for example, they can vote for a merger and acquisition or the salary of the CEO. As a holder of a Fan Based Token, you can only influence non-economical strategy – at the distraction of the club. As a shareholder, you are entitled to proceeds of the company in case of liquidation. Which you probably won’t in the case of a Fan Based Token.
Currently, by creating a “Fan Token Offering (FTO)” linked to its team, Chiliz is the spearhead of the socios.com platform which allows any sports organization to monetize its fans. The tokens created on this occasion may allow, among other things, the management of the team in question to have certain rights to participate in VIP events or to be rewarded with discounts on ticket prices for their loyalty.
How does Chiliz work?
The approach put in place by Chiliz to try to involve the supporters more in the leadership of their favorite team currently works as follows:
- Fans can directly vote for questions related to their favorite sports organization on the socios.com platform.
- By becoming a source of funding for clubs and teams, this socios.com also enables new teams or sports to emerge.
- Strictly speaking, the Socios platform will not necessarily allow token holders, particularly if it is important, to have the last word on their team’s management. The people in possession of the tokens could, for example, try to influence the choice of players to line up during a friendly match for a football match, propose a design for new jerseys, or even suggest the creation of certain derivative products for a football match.
- The influence of the supporters will then direct the choices of those in charge of the sports organization, as their income comes primarily from the individuals who support their team. Then, managers will have a clearer idea of what the fans expect.
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How FTOs work on the Socios platform
Fan Token Offerings work like this:
- First the sale of tokens (Fan Token Offering or FTO) is carried out by the platform-settling sports organization. For sale at a given price and in limited quantities, a limited number of tokens are offered.
- Fans have varying influence over the choices, depending on the number of chips a team owns. It is possible to exchange them for CHZ afterwards when all the tokens from the FTO are sold.
- When voting, fan tokens do not burn. Again, they may be used for future votes.
Examples of what fans can do with their tokens are as follows:
- Decide which PSG team player they would like on Twitter to interview. PSG will then propose several names and the person who answers the questions will be the one who wins the most votes.
- Choose which new product in the fan store they prefer to see.
- Propose a new jersey to the players…
Concrete example of the operation of the socios.com platform
Here is a concrete example of how a new team’s arrival on the platform works:
- Take two teams, Barça and Juventus, for instance. The platform will create two separate tokens, one for each team, when these teams arrive on socios.com. We’re going to call them $ BAR and $ JUV.
- These teams then decide on the number of tokens to be put into circulation and the price associated with the token, fixed during the ‘FTO’. For example, $ BAR may have chips of 40,000,000 and a € 1 prize, while $ JUV may have chips of 20,000,000 and a € 2 prize.
- Each time a team submits something to the vote, according to the formula 1 token=1 vote, each holder of a token will be able to give his opinion.
- Currently, on socios, only football is represented. But other sports, as well as electronic sports, will follow in the future (also called e-sports).
The technical functioning of the platform
Socios uses two different blockchains to operate . A “permissioned sidechain” was the first and the Ethereum blockchain was the second.
- Permitted sidechain”permissioned sidechain”permitted sidechain. Actually, it is a copy of Ethereum, but modified to only be dedicated to Chiliz. On this channel, everything that happens on the platform in terms of voting and purchasing / selling is stored. This dramatically lowers transaction costs by adding a new block to the chain using a Proof of Authority (PoA) system. This channel is also scalable if necessary and can easily accommodate an increased number of transactions, such as during a vote where several million supporters are asked to give their views.
- The Blockchain of Ethereum . In terms of ERC20 transactions, everything that happens on the platform is recorded on this blockchain. It will primarily exchange OTF tokens for CHZ tokens.
To summarize briefly, the Ethereum chain will be issued with CHZ tokens, while the sidechain will be issued with tokens from FTOs.
The business model of Chiliz
Chiliz had to develop a business model that allowed it to collect revenue in order to be economically viable. Here’s how the latter functions:
- Transaction fees will be charged each time a user makes a transaction on the Socios platform .
- The votes, however, will still be free once the tokens are in the fans’ possession.
- Part of the transaction fees will be received by teams and entities that use the Socios platform.
- The money collected will go directly to the crates of the team concerned during the purchase of the tokens.
- Therefore, this will encourage teams to register and generate revenue by encouraging the public to use the platform.
CHZ Token Information
There are 3 uses of the Chiliz token (CHZ):
- It allows you to participate in votes on the platform of Socios.
- The token allows you to purchase tokens on the platform from FTO.
- It will enable you to make purchases in-game, take part in challenges and collect certain items. It is set for the year 2020.
Token destruction and the blocking mechanism:
- Socios will burn 20 percent of the transaction charges collected in CHZ.
- 10% of the commissions received by Chiliz during an FTO will be burned and 3 months will be blocked by the CHZ collected by the teams.
- It will burn 20 percent of the CHZ commissions collected when purchasing collectibles.
Distribution information for tokens:
- It has a total of CHZ 8,888,888,888.
- 34.5 percent belong to investors who participated in the private placement that preceded the ICO, 20 percent serve as a reserve, 15 percent will be used for marketing operations, 15 percent will be used for strategic acquisitions, 7.5 percent belong to the very first investors (seed investors), 5 percent have been given to the team and 3 percent have been used to remunerate the consultants.
- Tokens that are not yet in circulation are planned for release as follows:
- From January 2020 onwards, 5% of the team’s tokens will be unlocked at a rate of 3% per month. Therefore it will take a little less than 3 years to fully unlock them.
- The 3% advisor-reserved tokens and the 7.5% original investor-owned tokens will all be released in July 2020.
- Starting in July 2019, reserve, marketing and strategic acquisition tokens, representing 50% of the total CHZ, will be unlocked at 7.7% every 3 months. Then, up to 7.7 percent will always be unlocked as of January 2021, but this time every 6 months
Team and partners
The team in Chiliz is made up of over 60 different individuals. Click here for the full list of members of the team .
Here is a summary of the journey for the project of the 4 most important people:
- Founder and CEO, Alexandre Dreyfus . As an entrepreneur in the digital world, he has 22 years of experience. Winamax (poker room) and Chilipoker were co-founded by him. He founded Mediarex Entertainment as well.
- Thibaut Pelletier CTO . Thibaut Pelletier 13 years’ experience in the development of online gaming and internet media applications and platforms. For online casinos, he has also created gambling and payment solutions.
- CSO, Max Rabinovitch . He’s been a consultant for 10 years on new technologies. For his customers, he is able to design a product from A to Z that he has already done for brands such as McDonald’s, Nestlé and Sony.
- Magnis Linder – Partnerships Head . He was responsible for Betsson (sports betting site) sponsorship for 3 years. He was also in charge of sales and marketing in the swedisch football league.
Partners:
Here is the list of partnerships that Chiliz has managed to conclude, whether in the world of cryptos or sports:
- Paratica,
- Lagardère sports,
- Ceyuan Ventures,
- Enjin,
- Ok Blockchain Capital,
- Binance,
- Bancor,
- Kosmos,
- Football teams: Barça, Juventus, PSG, Atletico de Madrid, West Ham United, As Roma and Galatasaray.
Advantages
- The platform enables millions of fans of sports and esports to control their favorite team.
- There are already large partnerships already in place.
- At present, there is only football, but later, the team plans to add a multitude of other sports.
- The token has real utility, because on the platform, only the latter can be used.
- The business model is interesting because teams can guarantee that while monetizing their base of supporters, their fans are involved in certain decision-making processes.
Disadvantages
- Even if this niche does not have too many competitors, other projects such as Bethereum and Asura Coin will be able to implement a similar voting system easily in the future.
- As 20 percent of blocked tokens will no longer be blocked by the end of 2020 and an additional 12 percent will hit the market in 2021, the inflation rate may be high.
How to buy Chiliz (CHZ)?
You have the option of using an exchange site like Binance or HitBTC to purchase CHZ tokens. Other exotic exchanges also enable you to get this token, but we do not recommend using these sites for security reasons.
How to store your CHZ?
Since Chiliz is an ERC-20 token, using a hardware wallet is the safest way to store his CHZ tokens . These in the form of USB keys, are electronic wallets. The Ledger Nano S and the TREZOR are the two best known .
The Chiliz website also recommends that your CHZs be stored using the ZenGo wallet . This is a wallet on a smartphone that works.
Ratings and reviews on Chiliz (CHZ)
The idea behind Chiliz is interesting and makes it possible for sports teams to monetize their fanbase, while allowing the latter to have a small impact on the decisions made by those in charge. It is an innovative concept that should enable both sports associations to have extra income, and fans to feel more involved in their team’s leadership.
The project currently only works with football teams. Since it is the most popular sport and the teams chosen are among the most important in the European championships, the choice to start there can only be agreed upon. Eventually, as well as new sports, many other teams will have to join the platform . There are even plans to join Socios for esports teams as well.
Nevertheless, keep in mind that it will take time for this project to become known. The CHZs blocked to publicize the project will only be released at 7.7 percent every 3 months for half a year or 46.2 percent at the end of this period, as we saw above in the distribution of tokens. They will then be released at the same rate but every 6 months, meaning it will take a total of more than 4 and a half years for all the project’s tokens to be in circulation.
Ultimately, the burn system put in place will make it possible to reduce the total quantity considerably, which will increase the value of the CHZs mechanically. If a craze for the project on the part of many sports federations is added to this, then it is a safe bet that Chiliz’s price may increase significantly in the years that follow.
Then it might be worth putting some of your savings into it if you are interested in the project. Be mindful, though, that this is a very long-term project. You are not in the right place if you want to pocket money quickly, and we suggest that you invest in another project that has a greater short-term potential for return.
Price and market cap of Chiliz
You can see the major CHZ cryptocurrency information below, including:
- The price: in dollars and bitcoin, as well as the change in values over the last 24 hours,
- The rank: CHZ’s global ranking relative to other crypto-currencies (the ranking is carried out according to the market cap of each crypto),
- Market cap: reflects Chiliz’s capitalization in dollars, that is, the cumulative value of all the tokens in use,
- Volume: equal to the cumulative number of CHZ tokens traded in the last 24 hours (in dollars).
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