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Market Overview

Trading Cards Are The Future Of Commoditization

Trading Cards Are The Future Of Commoditization

Sway House co-founder weighs in on future trends.

As a kid growing up in the early 2000s outside of Toronto, I loved hockey, football, and Pokemon cards. I spent all of my allowances and collected change to buy extra booster packs and at one point had over a thousand cards. I managed to find or trade for all of the impressive gen 1 and gen 2 holographics, Charizard, Mew, Kangaskhan. And then poof, I grew up, forgot about / lost the cards in the shuffle of becoming an adult and moving to LA. This is such a common story. Generations before me, my dad and his friends would buy and trade baseball and basketball cards in the 80s and had a similar experience. At the time, it was just a toy and a fun Saturday afternoon.

Fast forward to 2020, and I’m scrambling through my room, on the phone with my parents trying to find those same cards as COVID hit and the world poured their money into the newest sexy asset class, trading cards. Not only do people not treat them like a toy anymore, people don’t even have an interest in having the physical cards in their hands anymore. They exist in the ether on a stock-like exchange, where people just watch the value of their assets rise and fall. I really wish I could put my hands on that holographic first edition Pikachu.

This asset class isn’t going anywhere. And not only is it not going anywhere, the tremendous amount of dry powder in the market today, and consumers thirst for more eclectic places to diversify their portfolio will fuel this fire. Gary Vee called it cold two years ago in a blog post “I think the next 2-3 years will be white-hot in the sports card market.” Here we are.

So, why now? What’s next? Why should you care?

This perfect storm:
Peoples’ extra time and attention at home during COVID
The realization that some of these assets are scarce (there are only 20k Lebron James rookie cards and a hell of a lot more people than that want to own a rookie card from the King).
Commoditization and democratization of the actual good, meaning the system (often through blockchain) verifies every aspect of the good and it becomes a part of the marketplace.
Value changes in real-time – platforms like Nigel Eccles’ StarStock are allowing people to buy, sell, trade cards without ever taking ownership. Day trading in this space is quickly becoming a reality!

Trading cards are just the beginning. Fine art, similarly, is already being bought and sold on the blockchain without ever taking physical possession, and the real-time democratization of assets will continue. Stud investor, StockX founder Josh Luber, has even started the first trading card fund. My only advice is to buy now! There will never be more of these classic cards getting printed, so pick your favorite player and get into the market!

Photo by Kendall Hoopes from Pexels.


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Posted-In: Josh Richards Sway HouseTopics General