Burn to Glory: Tournament Wins Set to Trigger National Fan Token™ Burns

Chiliz, the world’s leading blockchain for sports and entertainment, has announced systematic token burns for national team Fan Tokens™ during the forthcoming global tournament.

For the first time on the international stage, real-world victories will trigger a percentage of that nation’s Fan Token™ to be burned from the treasury, directly tying match results to token scarcity. 

If that wasn’t exciting enough, the burn percentage will increase as the tournament progresses, incentivizing traders to hold national tokens ahead of high-stakes matches.

The important thing to note is that treasury holdings are utilized as the burn source: fan balances are never touched, only those held by the sports entity in question. Because wins burn treasury tokens, the total supply shrinks and what circulates becomes rarer.

Here’s everything you need to know about Burn to Glory.

What is Burn to Glory?

Burn to Glory is a mechanism by which tournament wins are reflected on-chain, with each victory causing a percentage of the country’s Fan Token™ to be burned.

The tournament will feature numerous national teams with Fan Tokens™, including reigning champions Argentina ($ARG) and 2016 European champions Portugal ($POR), and these assets are likely to attract significant market participation as the tournament unfolds.

This would be the case regardless of token shocks, however the launch of Burn to Glory means that every game will carry more weight. Victories don’t just take teams closer to lifting the iconic golden trophy, they automatically shrink Fan Token™ supply.

By using treasury holdings as the burn source, the campaign creates a direct correlation between on-pitch success and token scarcity without impacting user-held balances in any way. To be clear, every win will destroy treasury tokens forever, not those held in a user’s wallet.

While the burn rate will be 1% for a group stage win, this rises to 2% for a round-of-32 victory and 2.5% for a round-of-16 win. From that moment on, the burn rate increases by 2.5% for each stage.

A quarterfinal victory, for example, will burn 5% from the treasury balance while a semifinal win burns 7.5% and a final win burns 10%. 

If a team manages to win every single game (8 wins total), the compound burn effect will result in a 25.18% reduction of the initial treasury balance, representing a significant permanent reduction in the asset’s total supply.

The escalation of burn percentages may motivate traders to hold a Fan Token™ in anticipation of a game if they believe the team will come out on top. Sell pressure is also reduced, since the circulating supply becomes relatively more valuable with every victory.

You can track token burns live here.

Why Token Burns Are Significant

For Fan Token™ holders, the prospect of owning an asset whose supply diminishes due to on-field wins is an enticing one.

It’s analogous to owning a collectible that suddenly becomes scarcer. Imagine, for example, holding a precious coin. Only 50 coins were made, but the manufacturer kept ten of them (20% of supply). 

If the manufacturer were to systematically destroy those ten coins, the total coin supply would reduce: the coin in your possession would represent a larger share of the total supply. 

What a Deep Run Would Look Like

The impact of token burns obviously depends on the size of the Fan Token™ treasury. A treasury-heavy token (90% reserve) winning every match would burn about 24% of total supply, while a token with a smaller reserve (27%) would burn about 7%. 

The above is of course an illustrative scenario. To determine treasury balances, click on an asset on the FanTokens.com homepage and compare its circulating supply (the amount circulating in the market/in public hands) to the total supply.

Visit the dedicated “Burn to Glory” landing page HERE.

Chiliz Leads the Way

Not for the first time, Chiliz is leading the way with Layer-1 protocol innovation in sports, setting the scene for increased market participation centered around the world’s biggest sporting showcase.

Chiliz ended the domestic football season on a high, with two of its partners competing for the UCL title, a game eventually won on penalties by holders Paris Saint-Germain. In anticipation of the final, $PSG and $AFC landed on Solana and Base and multiple DEXs ran trading contests offering $25k in prizes.

Now attention shifts to international football, and several Fan Token™ nations are seeking to go all the way to the tournament final on July 19. With each win triggering a token burn, games will become alluring liquidity events for SportFi traders around the world.

Ready to get involved? Explore tokens featured in the Burn to Glory campaign here.

FAQ

• What is Burn to Glory? A treasury-deflationary framework by which wins trigger Fan Token™ burns.
• What does it mean to burn a token? To permanently remove the token from supply, in this case by burning tokens held in the treasury.
• Does this affect the Fan Tokens™ in my wallet? No, only treasury tokens are burned.
• How much is burned at each stage? Group stage: 1% per win (3 games), round-of-32: 2%, round-of-16: 2.5%, quarterfinal: 5%, semifinal: 7.5%, final: 10%. Each burn is calculated on the treasury balance at the time.
• Why would fewer tokens matter to me? As the total supply shrinks, tokens you hold become scarcer.
• Which national teams are taking part? Chiliz national team Fan Tokens™ such as Argentina ($ARG), Portugal ($POR), Belgium ($BELG), Scotland ($SFA), and South Africa ($SAFA).

Ronnie McCluskey: Fan Tokens™ Market Reporter