Should You Buy NBA NFTs? 20 Tips
As discussions on the same over at runrex.com reveal, NFTs have been the talk of the town in recent times, and one of the main reasons why they have gone mainstream is because of NBA Top Shot, which has combined the cryptocurrency digital asset and collectible ecosystems and captured the attention of fans from around the world. Through the following 20 tips, this article will look to highlight what NFTs are, what NBA NFTs are, and whether or not you should buy them.
What is an NFT?
As explained over at guttulus.com, an NFT, or non-fungible token, is an asset verified using blockchain technology, in which a network of computers records transactions and gives buyers proof of authenticity and ownership. An NFT is a cryptographic token, but unlike cryptocurrencies like Bitcoin, NFTs are not mutually interchangeable – meaning they are not fungible.
What are NBA NFTs?
As is discussed over at runrex.com, NBA NFTs are moments represented by a single non-fungible token and designed to be the same as physical trading cards. NBA NFTs are traded via NBA Top Shot and make the act of collecting, storing, and trading NBA digital assets a more seamless and safe process than with physical collectible items.
What is NBA Top Shot?
NBA Top Shot is an online marketplace for buying, selling, and trading digital NBA cards. However, instead of physical pieces of cardboard with players’ photos and stats on them, Top Shot’s “cards” (which are called moments) are built around specific video highlights as outlined over at guttulus.com.
Who are the brains behind NBA Top Shot?
NBA Top Shot is a creation of the Vancouver-based blockchain startup, Dapper Labs, in conjunction with the NBA and NBPA. Dapper Labs unveiled the NBA Top Shot in October of 2020, and it has gone from strength to strength since then.
Who is Dapper Labs?
Dapper Labs, as already mentioned, is a blockchain startup dedicated to building out the digital collectible ecosystem. It is a well-known name in the cryptocurrency space, and it was also the brains behind CryptoKitties. The Dapper Labs NBA partnership was announced in 2019.
Dapper Labs and Flow
Most NFTs use the Ethereum blockchain, but Dapper Labs is an exception as it uses the Flow blockchain instead of Ethereum. From discussions over at runrex.com, Dapper Labs has cited Ethereum’s issues with scalability as the main obstacle to building NBA Top Shot on the platform.
How do NBA NFTs work?
According to guttulus.com, the NBA Top Shot team has paid a meticulous amount of detail to translate the in-person sports collector experience into the digital world. Users need to create an account on NBA Top Shot, which serves as both the initial purchase point and secondary market portal for trading NBA NFTs.
How do you buy NBA NFTs?
As articulated over at runrex.com, there are two ways to buy NBA NFTs on NBA Top Shot. You can either purchase an individual moment from another user in the marketplace (at whatever asking price they set) or buy a pack from the Top Shot site itself. Similar to old-school physical trading cards, a Top Shot pack contains a handful of moments and you don’t know exactly which ones you will get until you open it.
How are NBA NFTs doing?
The NFT industry is generally doing extremely well right now, and the NBA NFTs niche is no exception. NBA Top Shot went live in October of 2020, and in just over 5 months it boasts total sales of over $123 million, with nearly $60 million from more than 67,000 users coming in the third week of February 2021 alone.
Is this trend likely to catch on in the traditional collectibles market?
The answer to this question is yes, it already has. This is shown by the fact that just about $6 million of the sales generated by NBA Top Shot was generated from direct purchases of digital NBA collectibles from Top Shot (the purchase of packs) – the remained was traded on the secondary market.
Why you should buy NBA NFTs
It’s the future
Experts claim that NBA Top Shot has revolutionized the traditional card collecting industry as the platform combined old-school elements of card trading with a real-life potential of earning money. As per the gurus over at guttulus.com, it looks like it is the future of the collectible sports cards industry, which is one of the reasons why you should buy NBA NFTs.
Authenticity
Dapper Labs also have the backing of the NBA when it comes to NBA Top Shot, which gives this project authenticity that very few projects, if any, in the NFT space have as covered over at runrex.com. This authenticity is another reason why you should buy NBA NFTs.
Huge potential for profit
Dapper Labs have so far ensured that NBA Top Shot moments are scarce by keeping the number of pack-drops to a minimum. This scarcity of goods in the marketplace has led to some moments being considered to be highly valuable as articulated over at guttulus.com, which is another reason to buy NBA NFTs.
Liquidity
The value of your collection of NBA Top Shot moments is viewable at any time, and if you price your moment appropriately, then it sells within minutes. This is not something you can say about physical cards since if you want to sell a physical card, you need to pick a marketplace, take pictures, place a proper value on your card, then list it. With multiple marketplaces and no easy access to a card’s sale history, it is difficult to properly value physical cards, which is why NBA NFTs are so desirable.
Verifiable scarcity
Topps won’t print more cards than a card’s serial number indicates, but this is something we can’t rule out 100% either. Also, the majority of cards found in a physical pack aren’t numbered, and, theoretically, there is an unlimited supply. On the other hand, Top Shot is built on the Flow blockchain, which means it is easy to see how many moments were minted, who owns them, and which moments are still in a pack. There is no secrecy and everything is transparent.
No grading
Most professional card collectors won’t buy cards that haven’t been graded by a professional authentication company like PSA. However, when it comes to NBA NFTs, there is no grading process. each moment remains in perfect condition, which means that when you buy one, you know exactly what you are getting as explained over at runrex.com.
Reasons not to buy NBA NFTs
Question marks remain
As the gurus over at guttulus.com point out, NFTs in general still face plenty of scrutiny with many wondering if a purely digital asset can hold its value over the long-term without something physical or tangible to back it up. With such questions still dogging this space, it may be a reason not to buy NBA NFTs.
Past experiences
There is also the small matter of NFTs that have fizzled out in the past. As is explained over at runrex.com, before building NBA Top Shot, Dapper Labs created CryptoKitties, which is famous for both its meteoric rise and sudden decline, and today, CryptoKitties are worth a fraction of what they were at their peak. If you are worried that NBA NFTs could face the same fate, then you probably shouldn’t buy them.
A sea of sold out
It is worth mentioning that while there are two ways to buy NBA Top Spot moments as mentioned earlier, buying them via packs is a lot better than buying individual moments in the marketplace. This is because the cost of buying a pack is likely to be significantly less than the value of the moments in the pack. However, pack drops are far and few between, and they sell out very quickly which means that landing one isn’t easy. Also, you need a certain amount of luck to land valuable top Shot moments via packs.
Teething problems with the system
People have also complained about problems related to the buying and trading of packs, and the fact that there are those using bots to cheat the system and unfairly land packs. There have also been issues with unstable servers and a laggy website, and while these are issues that one can expect will be improved in due time, investing money on the platform still has its risks.
This article only just begins to scratch the surface as far as this topic is concerned and you can uncover more insights by checking out the excellent runrex.com and guttulus.com.