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The value of Socio.com’s blockchain native token Chiliz has bounced 44% off its 12 May session lows following the rollout of the second phase of the project’s Scoville Testnet – Jalapeno.
Back in 13 May, the company published an intriguing post on Twitter that pointed to the upcoming launch of the testnet. Then, only four days after, it officially announced that Jalapeno was live.
Alongside the news, the company informed that a new decentralized exchange was now running on the testnet. The name of the DEX is PepperSwap and it currently allows users to swap their Chiliz (CHZ) tokens for any of the network’s 12 fan tokens including those of prominent soccer teams such as Juventus, Paris Saint-Germain, and Inter Milan.
The Chiliz blockchain currently supports 1.48 million wallet addresses and has processed over 20 million transactions with the average block time standing at 5 seconds since the network was launched.
So far this morning, the value of its native token CHZ is sliding by 3.5% at 11.4 cents on the dollar while it accumulates a 60% loss since the year started. Even though the latest uptick prompted by the launch of the Jalapeno phase has not been a trend-changing event, the positive performance of the token since 12 May is a rare sight in today’s heavily depressed crypto market.
What Are Fan Tokens and How Does the Chiliz Blockchain Work?
Fan tokens are synthetic digital assets that trade in a layer-one blockchain. They allow the fan base of a sports team to have a saying in the organization’s decisions.
Through the use of surveys and other similar mechanisms, fans can vote on multiple different aspects of the team such as which players they may acquire, the line-ups they may choose for a particular game, or what design for the uniforms should be picked.
In addition, fan tokens can also facilitate the distribution of rewards and perks to a team’s fan base via the blockchain. Say, for example, that a team wants to give out tickets to a certain match. Through fan tokens, the Chiliz blockchain, and possibly by using a non-fungible token (NFT), this can be done in a matter of minutes.
Chiliz is a blockchain created by Socios.com – a sports entertainment platform. This network provides the environment in which fan tokens can thrive and valuable partnerships have already been established with some of the world’s top soccer teams.
The demand for CHZ is driven primarily by the adoption of fan tokens by the teams that have partnered with Socios.com to increase engagement with their respective fan base. The token is supported in both the Ethereum and Binance Smart Chain and its maximum supply is set at 8.89 billion.
A Closer Look at CHZ Price Action
Despite the latest uptick in the price of CHZ, the chart above shows that the value of the digital asset remains in a sharp downtrend unless its breaks above the 25 – 30 cents level in the following weeks.
Weakness across the entire ecosystem amid a change in the market’s sentiment due to a shift in macroeconomic conditions has been the primary catalyst for this decline.
The practical use of the Chiliz blockchain and its native token CHZ is the strongest appeal of it as an investment. The widespread adoption of the network as the infrastructure for launching this kind of marketing initiative would have a positive influence on the token’s long-term prospects.
According to estimates from Wallet Investor, an algorithm-based forecasting service, the price of Chiliz is expected to rise to up to 15 cents on the dollar one year from now. Meanwhile, estimates from Gov.Capital point to a positive mid-term outlook as well as the price of CHZ is expected to rise to 66 cents in the next 12 months.
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