A new decentralized finance model (DeFi) is targeting a persistent problem that soccer clubs face: short-term liquidity gaps caused by uneven cash flows from media and commercial contracts.
The Decentral protocol, hosted on the Chiliz blockchain, enables clubs and sports organizations to raise stablecoin liquidity by tokenizing future receivables, such as broadcasting rights, and using them as onchain collateral, according to an emailed announcement shared with CoinDesk on Monday.
Investors supply capital to decentralized pools, while clubs gain faster access to funding without relying on banks or specialized funds that often charge high fees and impose heavy administrative requirements.
Decentral will hold an initial liquidity pool of $1 million in the USDC stablecoin, with a 90-day lock-up period and an anticipated 12% APY, Chiliz said in Monday’s announcement.
When clubs receive payment from the sponsor, broadcaster etc it is paid into Decentral’s smart contract, allowing liquidity providers to withdraw their principal along with any accrued return.
“The key point is that the return is settled onchain from a pre-existing contractual revenue stream, rather than being generated through trading or other activity,” a Decentral spokesperson told CoinDesk in a Telegram message.
Better access to capital
The approach speaks to a long-standing pain point in sports finance.
Clubs frequently hold valuable long-term contracts but struggle to bridge day-to-day funding needs, particularly outside of the game’s most elite clubs. By converting those future revenues into real-world assets (RWAs) on-chain, the model could allow quicker settlement, improved transparency and global access to capital.
Tokenization of RWAs refers to the process of representing traditional financial assets, such as stocks and bonds, as digital tokens that can be bought, sold and traded on blockchains.
Alex Dreyfus, founder of Chiliz, said the development reflects “SportFi’s” shift from concept to practical utility, as blockchain infrastructure is used to finance the core mechanics of the sports economy.
Chiliz is one of the leading projects in SportFi, bridging the gap between traditional sporting business models and blockchain technology. The most prevalent use case in this sector has historically been the issuance of fan tokens — cryptocurrencies which allow holders to speculate on a team’s fortunes while also gaining access to exclusive rewards and experiences.
UPDATE (Dec. 15, 15:30 UTC): Adds detail on mechanics of Decentral protocol and quote from spokesperson.
