By now, you’ve probably heard of Bitcoin, cryptocurrency and – perhaps a little less likely – blockchain.
But now the NBA has got in on the action, with a revolutionary new offering called “NBA Top Shot”.
Here’s exactly what that is – and why it’s raking in hundreds of millions of dollars, as well as got players and fans going wild.
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WHAT IS IT?
NBA Top Shot allows users to collect and buy or sell officially licensed NBA video highlights, known as “Moments”.
Fans can also build and share personal collections of these Moments, and complete challenges (such as compiling a group of Moments featuring players from the same team, for example).
CAN’T I JUST WATCH THESE HIGHLIGHTS ONLINE?
Yes, you could watch any number of LeBron James dunks or Steph Curry three-pointers on Kayo.
And you could show off your favourite clips to your friends – and the world – on your social media.
But Top Shot offers more than that: it provides scarcity, and a shiny new product protected by blockchain technology.
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Only a limited number of each Moment are released. For common ones, that can be more than a thousand. For rarer Moments, that can be 99, 49, or even as few as 3. In the future, Top Shot is also looking at selling limited editions of just one.
Each collectable comes with its own unique serial number, so you might own – perpetually – #14/49 of an iconic Giannis Antetokounmpo jam.
You can keep all of your Moments in a secure ‘wallet’, and the whole system is protected by fully encrypted blockchain technology. That’s the same system behind Bitcoin and a bunch of other cryptocurrencies, and basically means the entire product is extremely secure.
Think of them like trading cards: rare or highly-sought after editions are worth more, and Top Shot guarantees your favourite, shiny-looking collectable will never have more cards printed, so to speak.
Plus there’s never any worry over Moments losing ‘mint condition’ if rats get into your collection.
In fact, modernising the lucrative and popular trading card industry, while getting in on the cryptocurrency craze, is exactly what Top Shot is trying to do.
HOW MUCH MONEY ARE WE TALKING?
Lots. Like, hundreds of millions – and that’s just talking about certain Moments
Last week alone, a Zion Williamson Moment of an epic block, and one featuring a LeBron James dunk, each sold for $100,000 USD. This morning, a LeBron James dunk sold for US $208k, or $263,000 in Australian Dollars.
Right now, there are Moments up for sale with an asking price of $250k USD.
When you buy or sell a Moment, Top Shot takes a small fee, which goes to the NBA, NBA Player’s Association, as well as the company (Dapper Labs) which helped create the product.
In the last seven days to Tuesday night (AEDT), a full $130 million USD ($164.5m AUD) of Moments were traded. That was a rise of 936.91% compared to the week earlier – and it’s rising quickly.
The product has been around since part-way through last year, but has absolutely exploded in popularity in the last fortnight with Top Shot going viral and a heap of players jumping on board to buy Moments of their teammates – or even themselves.
HOW CAN I GET STARTED?
Fans (or investors, however you see it) can jump into the marketplace and start looking for their favourite Moments.
But there’s another way to start: buying ‘packs’ containing a number of Moments.
A common pack, for $9 USD (which goes to Top Shot, and therefore in part to the NBA), contains nine common Moments. Over 1000 of each of those Moments has been produced, and there’s no maximum. They can be worth less than a dollar each – but right now, they’re typically selling for ten bucks a pop.
Then there’s rare packs ($22 USD), with seven common moments and one rare moment, which has a maximum production of 999.
Finally, there’s legendary packs for $230 USD. They include six common Moments, three rare Moments, and one legendary Moment, which are limited to – at most – 99.
It’s those that can be worth hundreds of thousands, if not millions, of dollars.
Here’s the catch: because millions of people are flooding to buy packs in the hope of receiving a particularly valuable Moment, they’re selling out in seconds.
Top Shot is only releasing a limited number of packs in ‘drops’ – much like trading cards or rare Air Jordan sneaker releases.
That scarcity – and the difficulty of getting in at the ground level, so to speak – is another reason prices are going up on the marketplace, where you can buy and sell individual Moments. Not to get all undergraduate economics, but that’s supply and demand.
WHY IS IT A BIG DEAL?
Well, no one wants to miss out on the opportunity to be part of the next Bitcoin.
For the record, this isn’t exactly like Bitcoin. Every individual Bitcoin is worth exactly as much as any other, like gold. The price may fluctuate but the product itself stays the same.
Here, there are thousands and thousands of different products – Moments – with each worth their own unique value.
It is still a form of cryptocurrency, but is known as NTG – non-fungible tokens. If that means nothing to you, don’t worry. Just think of these Moments as trading cards: some are worth more, some are worth less, so you can’t quite use them like a regular currency.