NBA Top Shot: The Latest Internet Craze?

Within the last year, the trading card industry has been rejuvenated, but no one knows if its success is sustainable or if the spike in interest is just the latest internet fad sparked by pandemic boredom. The newly-developed online marketplace, NBA Top Shot, is certainly riding this wave of popularity, and it doesn’t look like it will slow down any time soon. 

Users can buy and sell officially licensed in-game NBA highlights exclusively through the website. The assets traded on the site are non-fungible tokens (NFTs) backed by blockchain technology that serves as a transaction history ledger. NFTs allow for original work to retain its value, as people have the ability to authenticate it through the blockchain network. In essence, no NFT is the same and they cannot be copied. Through purchasing a highlight, buyers are able to obtain the NBA’s intellectual property of that highlight. 

The website offers common, rare, and legendary tier highlights in addition to packs of highlights that vary in price and availability. Prices range from five dollars to $250,000; amazingly, within the past month one user bought a Lebron dunk for $208,000, setting the record for the largest purchase in the site’s short history. Purchases from over 100,000 users have resulted in more than $250 million in sales. In fact, Michael Levy, one of NBA Top Shot’s preliminary investors, turned the $175,000 he spent on virtual highlights into $20 million by reselling them. 

To build the marketplace, the NBA partnered with blockchain game developer Dapper Labs, which handles the distribution of highlights and packs. Dapper Labs is known for its creation of CryptoKitties which allowed people to collect virtual cats, a fad forgotten outside of its few successful weeks in 2017. The company’s past might be an alarming sign for some, but people have more confidence in this new endeavor as basketball highlights can generate more buzz than virtual cats. Sports cards have historically performed surprisingly well, and their nostalgic nature causes people to revisit them as adults. Furthermore, the dopamine rush from opening these packs is, in part, what keeps people buying. Owning a popular highlight adds another dimension to the typical cardboard trading cards that only include a picture, and there is no risk of damaging or losing them because they are all stored on the website. 

Despite being a complicated company with demanding prices, NBA Top Shot is one of the leaders in the promising NFT market that is redefining the concept of ownership. Whether or not NBA Top Shot will be around for the next five or 10 years is still a mystery; however, the technology behind its prosperity is here to stay.