By David Peto ’23
The world of sports trading cards has seen a revolutionary new idea called NBA Top Shot. The concept is simple yet fascinating and incredibly difficult to wrap one’s mind around. NBA Top Shot is an online company and website which sells NBA player’s highlights (also known as digital collectibles) through packs, and then the highlights are auctioned off between website users for astronomically high prices. A highlight card of LeBron James dunking on Namanja Bjelica recently sold for $208,000, even though this clip is available to view for free on YouTube.
Who in their right mind would pay so much for a short clip of a basketball highlight? The answer to that is someone looking to make a profit. This online market works similarly to real sports cards: the website puts out a limited amount of a certain highlight card through packs bought by users, and then the value of a highlight card owned is purely based on the demand for that card and the rarity level (common, rare, legendary, platinum ultimate, and genesis ultimate).
There is absolutely no intrinsic value for these highlights; it is solely a fragile market of supply and demand.
With that in mind, it is understandable why these digital collectibles are being bought. In a perfect scenario a user buys a pack for $14.99 and they get lucky, pulling a card worth $100, which they then sell to someone else who wants that card, and that buyer holds onto it for a couple months until the value is up to $1,500, which causes them to sell it, and then the process continues.
This happens with cards of all values, but what happens when the demand for these highlight cards dries up? Everyone still owning highlight cards is left with a massive hole in their bank account and a worthless clip of, for example, James Harden knocking down a step-back three.
Proponents of NBA Top Shot argue that it is just the newest form of cryptocurrency. And they might be right, the value of a cryptocurrency like Bitcoin is based entirely on the demand for it and holds absolutely no intrinsic value. Bitcoin is seen as a relatively smart investment by outsiders, but those same people laugh at someone for purchasing a short NBA clip for hundreds of thousands of dollars.
NBA Top Shot may be a quick high-risk cash grab, or it may be another cryptocurrency-like investment, but one thing’s for certain—highlight cards are not being bought for the same reason as sports trading cards. The goal for most buyers of trading cards is to build a collection of the players they most admire and to be able to brag to a friend about a certain card they have; on the contrary, the goal of buying an NBA Top Shot card is to be able to make a profit by holding onto it until the value rises. Trading cards can be purchased recreationally or for profit, while Top Shot is almost exclusively for profit.
Time will tell if Top Shot lasts as long as trading cards have.