The start of the school year should be hectic for Sorare. As BFM Business has learned, the National Gaming Authority (ANJ) has issued a warning to the young company, which is behind French Tech’s largest fundraiser ($680 million). By the fall, Sorare, valued at $4.3 billion, will have to prove that it is not a sports betting platform in disguise.
To understand the accusation against Sorare, it is necessary to go back to its operation: customers can buy virtual cards (whose ownership takes the form of NFT), more or less rare, associated with a footballer, to speculate. increasing according to the evolution of the notoriety of the latter.
The purchase of the cards in question
They then use those same cards to enter virtual tournaments, which earn rewards based on player stats associated with the cards, in real matches. For example, in the event of a goal or assist. It is this use that crystallizes the ANJ’s doubts.
A definition to which the activity of Sorare could correspond, which has just hired Kylian Mbappé as an investor and ambassador, in the eyes of Frédéric Guerchoun, legal director of the ANJ.
This notion of financial sacrifice is not perceived in the same way by Sorare, who defends the operation of his platform.
Big Potential Consequences
The French regulator, however, is not the only one who views Sorare’s activity with a bad eye. In October 2021, the British equivalent of the ANJ opened an investigation into the young company, for these same reasons.
For Sorare, this threat could weigh heavily. French law prohibits games of chance, despite certain exceptions such as casino or sports betting. If the purchase of virtual cards to earn money based on sports performance is characterized as sports betting, then Sorare must apply to the ANJ to become an authorized online operator, just like Betclic, Winamax and consorts.
In addition to facing increased taxation, Sorare would have to control the identity of each user and prohibit access to minors (which is already the case according to its terms of use). This could have serious consequences on the number of active users of the platform and its profitability.
Source: BFM TV
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