Well, it’s official folks. Even the basic inalienable concept of a basketball game where 5 guys try to score more points than another set of 5 guys has become the stuff of the future.
No, it’s not being played by cyborgs just yet. Although it wouldn’t surprise us if LeBron James turned out to be a well-oiled scoring machine…
Anyway, that’s for another article.
Back to the riveting world of crypto-currencies and virtual reality.
SO – WHAT IS NBA TOP SHOT?
Well, the NBA Top Shot concept revolves around the buying and selling of NFTs.
If you’re unfamiliar with the concept of NFT, or Non-Fungible (no – it’s nothing to do with mushrooms) Tokens then welcome to our world.
But let it never be said that the team here at The Jump Hub aren’t willing to move forward with the times and keep up with all the latest trends and gimmicks.
Actually, with the amount of money that seems to be exchanging hands for these ‘NBA Top Shot Moments’, it’s way beyond being a gimmick at this point.
The digital world is still bordering on the alien to those of us who are just too old to have grown up with it.
But when we hear that hundreds of millions of dollars are involved, our ears prick all the way up!
BUT LET’S NOT GET AHEAD OF OURSELVES…
Ok, to our ancient, addled brains, the best way to imagine how the NBA Top Shot system works is like this…
They are virtual Panini stickers or trading cards but with officially licensed video highlights.
If you’re looking for a more in-depth understanding and analysis of this virtual trading card business and how it all works then please read on.
If you just wanted to grasp the basic idea so you can move on with your life then – you’re done. You’re welcome. Thanks for dropping by.
THE ORIGINS OF THE TOP SHOT MOMENT
The idea of replacing physical cards with virtual ones using blockchain technology was a revelation. A joint venture between Vancouver-based blockchain online company Dapper Labs, the National Basketball Association, and the NBA Players Association led to where we are now.
So – let’s start at the beginning
Those “Non-fungible” tokens we referred to earlier are the key to how Top Shot works.
The concept of non-fungible tokens (NFTs) is not a new one. People have been using them to sell digital art for a while now. What is new here is the joint venture aspect and the way the shot packs are marketed. They are touted as digital collectibles to appeal to basketball fans rather than investors.
The fact that so much money is already swimming around in this market means that has already failed (from the perspective of the basketball fans) but more of that later…
If we think in terms of other online, crypto entities then Bitcoin is the most obvious one.
A BITCOIN IS FUNGIBLE
In other words, it can be replaced by another one and there is no difference. They are all the same.
The officially licensed product that Top Shot offers in the form of trading cards are all unique. It effectively means that they cannot be replaced by something else. Yes, some of them may contain the same video clip and be sold thousands of times over but no two have the exact same serial number.
RARE MOMENTS ARE AUTOMATICALLY WORTH MORE
Specific moments that are less rare but have lower serial numbers are also worth more than ones with less-desirable, higher numbers.
If you can get your hands on LeBron James dunking with the same serial number as the one that he wears on his back then you’ll probably never need to work again…
As there is clearly no shortage of NBA highlights and more are created every week, the scope for this to grow is almost limitless.
MOMENTS, SETS, AND SERIES
So, as we’ve discussed, Top Shot is essentially an NFT marketplace. It allows any Top Shot user to buy, sell, trade, and collect NBA scoring Moments that come in packs much like physical trading cards.
YOU BUY A PACK, WHIP IT OPEN AND EXCITEDLY SEE WHAT YOU GOT
Each Moment is an individual NFT that displays a single highlight from a play out of the official NBA archives.
Packs come in sets that are part of a wider series. The timeline of each series corresponds to a particular NBA season. So – series 1 is the NBA 2020 season and that system looks set to continue.
There are also opportunities to collect retro moments from NBA history for those nostalgia freaks like us who don’t really care about the investment aspect but are obsessed by historical events.
The rarity of each pack is nice and clear.
THERE ARE 3 CATEGORIES
There is an extra ‘Ultimate’ class but those Moments will only be available via auction and will have edition sizes of 1-3 only.
TRUST US, YOU CAN’T AFFORD THOSE
THE MECHANICS OF GETTING INVOLVED
The process of creating an account with Dapper Labs could not be more straightforward. You’ve done it a thousand times before so we’re not going to walk you through that.
The whole online marketplace they have created is remarkably user-friendly and easy to navigate. You will be ensconced in the world of digital collectibles so fast it will make your head spin.
It will also make your wallet empty very, very quickly. The starter pack you are entitled to purchase as soon as you register costs $9. And that’s as low as it’s ever going to get. Any pack drop will be squirrelled away before you even have time to decide if you want to buy one so don’t plan on boosting your collection that way. The online marketplace allows for trading and buying/selling very easily.
THAT IS WHERE YOU WILL LIVE
The vast majority of Top Shot users will never find themselves able to purchase digital packs via pack drops. It is simply too difficult to do. More of that later.
DON’T SAY WE DIDN’T WARN YOU…
In the Top Shots marketplace, you’ll see that each Moment has either CC or LE underneath it.
CC refers to the ‘circulating count’ and denotes the number of editions of that Moment that are currently in circulation. These Moments are, to all intents and purposes, an open edition. There is no limit to the number of times that they can be minted. They will continue to be created and sold as a ‘common moment’. These are the infantry in the world of Top Shot NFTs.
As we mentioned, lower or significant numbers (yes – 69 is one of them you muppets) will be worth more, but they will all be worth roughly the same after a point. Think Stormtroopers in Star Wars. Cannon fodder. Lose one, get another. The low numbered ones are the AT-AT drivers. Ok, enough of that.
LE stands for Limited Edition. These moments are finite and are usually released in lower quantities of 50, 100, 750 etc…
The largest sales on the site are usually those that come from this category, the LEs. Being limited, they are much more desi
When you own Moments, you can do things various things with them. There is an option to create ‘Showcase’ albums. You can sell or gift them to others.
THE BOTTOM LINE
Look – we’re coming at this as old fogeys who love to reminisce about bygone times. This is not the place to seek financial advice. However, we have done plenty of research for this article and feel confident enough to offer these words based on our observations:
At the end of the day, this is just another variation of gambling, so apply the same rules. Set a budget that you’re comfortable with and STICK TO IT. Never invest more than you’re willing to lose.
Before you even open an account, read our article on ‘How to manage your bankroll in sports betting‘ and almost every word of that is relevant to this situation.
Decide why you’re getting into this.
Are you a nostalgic daydreamer with a little bit of spare cash to throw at regaining your childhood? (Us)
THAT’S FINE, OWN IT
If you’re in it for the investment opportunities then that’s fine too.
But never the twain shall meet…
Stick to the plan.
If you’re buying a Moment in order to turn it over quickly, then do that. Don’t buy Moments that you can’t afford to hold onto if everything goes tits up.
Pay close attention to serial numbers and other details.
Don’t let a low-numbered LeBron James dunk go cheaply and realize afterwards that it was worth ten times more. Treat it seriously and do your due diligence.
Think about the historical significance of any Moment you have in hand or are considering purchasing.
Superstar players dominate sales but there is a niche in this market for the first basket/assist/steal/ (you get the picture) of any player’s career. These will always be worth significantly more than subsequent Moments for fans of that player.
Look for mistakes and misprints.
They are rare but that’s the name of the game! Go and Google ‘Inverted Jenny’ and then re-evaluate your opinion on printing mistakes.
The concept behind buying and selling these Top Shot Moments is tried and tested. 100% of the guys in this office have collected stickers for everything from the NBA (of course) to English soccer, Star Wars, and E.T.
No, I’m not joking
The thrill of opening a new packet of stickers is hugely enticing. It’s the anticipation of what you might find. The knowledge that you might get something your buddy needs so you can make a deal with him.
WHAT IF YOU GET A REAL RARITY?
The collection itself also drew you to keep opening more and more packs. Completionists at school would be beside themselves with anguish if they needed just a few stickers to complete whatever book they were working on. And yet, once the books were filled, the thrill was gone.
They might be taken from a shelf with a flourish and shown to friends in a moment of braggadocio but were otherwise done with.
PANINI HAS A LOT TO ANSWER FOR…
The genius of that marketing idea is that it excites a virtually insatiable desire to open more and more packs. To transfer that feeling from physical trading cards to digital collectibles was always just the next, inevitable incarnation.
We just wish we’d thought of it first.
In the course of researching this article, 3 of the guys in The Jump Hub crew have signed up for an NBA Top Shot account and are already giggling like school kids and excitedly looking to see if they have scored a starter Top Shot pack with a rare and valuable shot moment inside.
UPDATE – THEY HAVEN’T
We should hardly be surprised that some clever boffins have figured out a way to take this basic excitement and ramp it up and modernise it. It is the way of all things. But, of course, when the values of these moments can be so high it attracts those that suck all the fun out of it. The idea has already been ruined as a genuine hobby for collectors and those not in it to make money.
The trading cards analogy works well because there is more scope for buying and trading moments via the peer to peer system here than there is to score a pack of Top Shot Moments when they drop on the website. Any pack drop is almost instantaneously snaffled up and gone before you even have time to comprehend the notification that it’s there.
That is the remit of those with programs that automatically outbid you by 1 cent on bidding sites with a nano-second remaining or buy up all the best gig tickets before any genuine fans can get their credit card numbers typed in.
This has pushed Top Shots closer to a site to trade digital assets than one for basketball fans to exchange video clips.
AND THAT’S A SHAME
Until the chance to purchase directly from the website rather than have to trade with algorithmic grifters is addressed the site will hold limited appeal for many.
Ourselves included. The 3 starter packs the guys just opened have been cast aside and almost immediately forgotten.
WHAT IS NBA TOP SHOT?
A great idea that has been hijacked…
Watch this space