NEW YORK (CBSNewYork) — Our world has gone digital, not just our interactions, but also money, and in trading cards.
As CBS2’s Steve Overmyer reported Monday, at the top of the digital scene is NBA Top Shot, a marketplace where people buy, sell, and trade highlights called “moments.” They can go from $10 to hundreds of thousands of dollars.
“So you own these items which are NFTs, non-fungible tokens, which pretty much just has verifiable ownership on the blockchain. A lot of complicated words, but you own it on the web at its core,” Top Shot buyer Jack Settleman said.
Settleman is just 24, and a website owner, but he’s also one of the leading Top Shot buyers.
“How much do you have invested in NBA Top Shot?” Overmyer asked.
“So, I invested $70,000. My account valuation right now is somewhere like $1.4 million, which is not normal money for me. It’s way more than my net worth,” Settleman said with a laugh.
While anyone can download a copy of these plays, each one on the marketplace has a digital certificate of authenticity.
“But what makes it valuable is that I can sell mine and you can’t if you’re just watching it on YouTube or recording it, because the blockchain tracks every single transaction,” Settleman said.
If blockchain sounds familiar to you it’s because it’s used for crypto currencies like Bitcoin. These Top Shot moments are the same, one of a kind verifiable assets, and just like trading cards when you purchase a pack you could get LeBron or Kent Bazemore. Or, you can buy moments.
“Buy the rookies you think can have great careers. Buy the studs, the LeBron James, Steph Curry, the ones where they have massive fan bases,” Settleman said.
Top Shot has nearly 1 million users and has reportedly generated more than $500 million in sales. The most valuable is a LeBron dunk selling for $387,000. The price is based on the moment, and how many are available.
“Is it about the player or about the scarcity?” Overmyer asked.
“That’s a great question. So, there’s some NBA Top Shot moments. The most famous is the LeBron James cosmic dunk. If the first legendary. He’s the best player in the league, but it is a random dunk against the Kings,” Settleman said. “Or you have his Kobe tribute dunk, which is numbered to 59.”
Settleman owns that moment. In fact, he owns the jersey match number 23 of that dunk, making it arguably the most valuable moment yet to be sold.
“Could it get a million dollars?” Overmyer asked.
“The expectation is it’s probably a million dollars,” Settleman said. “The actual goal is to sell it directly to LeBron for a million dollars. If LeBron James buys that it’s worth $100 million.”
But it’s not without the risk of a market collapse. It has happened before.
In 1995, Beanie Babies were the rage. The $2 toys were in such demand, some sold on the secondary market for hundreds of thousands of dollars. Within four years the fad ended and the market dried up.
“I want to be clear. Top Shot could fail. NFTs, though, as a whole, my bet is they are the lock of the century,” Settleman said.
The NBA has a vault full of old memories it can turn into NFTs. It not only creates the art, but it also sells it, making the NBA both the Rembrandt and the Sotheby’s. The value is in the eye of the digital holder.