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Are collectible trading cards NFTs-in-waiting? Some investors hope so

Growing up in the 1990s, Alexis Ohanian was more into fantasy battles than fantasy sports, playing the trading card game Magic: The Gathering, casting spells to summon creatures and defeat opponents.

Back then there wasn’t a lot of overlap between geeks and jocks. Remembering my own school days, the cool kids were all swapping football stickers while I was the one trying to complete my Star Wars sticker album.

Nerding out paid off richly for Ohanian, who went on to co-found the social media platform Reddit. But he’s since come around to the idea that jocks and geeks aren’t so different, and not just because he’s married to tennis champion Serena Williams. Sport’s appeal lies in gameplay, competition and lots of stats to obsess over. According to Ohanian, it’s “just Dungeons & Dragons for jocks”.

When we spoke last month, Ohanian, now a significant investor in start-ups and crypto, outlined his unifying theory of sports and the future of entertainment. In this view, a one-time event like a football game gives sport a unique position in the industry.

We can watch that movie later, but the live game or contest is a non-negotiable in fans’ schedules because of the drama and tribalism that goes with it. “Sport is the only form of legacy entertainment that’s going to really thrive over the next 50 years,” Ohanian says.

This seemed a little bombastic when I first heard it. But the day after we spoke, Netflix dropped the bombshell that it was no longer adding subscribers, sending its stock price spiralling. Suddenly, the issue of our oversaturated entertainment diets seemed a lot more pertinent.

Ohanian’s betting on society’s ongoing fascination with sports. A survey last year for PwC found that under-24s had the highest overall interest level in sports of any age group (60 per cent), though they spent the lowest time actually watching it, at just 17 per cent of their media-consuming hours.

And with videogames dominating youth culture and esports blurring what it means to be an athlete, the owners of traditional sports teams and leagues are increasingly looking to hook the next generation of fans. Tech investors like Ohanian are seeking new outlets for sports fans who follow players, even if they don’t watch every game.

One idea, pioneered by French start-up Sorare (one of Ohanian’s investments) is to turn those paper trading cards of my youth into non-fungible tokens. Each player is “minted” as a unique NFT, with ownership recorded on a blockchain.

Beyond Sorare’s fantasy football game, in which you compete in leagues against other players, that record can mean playground bragging rights or the ability to sell a player on if they do well this season. In Ohanian’s eyes, collectible nostalgia plus sport equals a “perfect storm” as an investor.

Crucially, NFTs allow users to keep their player cards from one season to the next and make money from trading, not just building a team. For Ohanian, that’s just as it was with his Magic: The Gathering collection. “It would have been preposterous to have given our cards back to [MTG publisher] Wizards of the Coast every day… We could do whatever we wanted with them.”

There are broader questions about the hype that has surrounded the NFT market, and how much of its exponential rise is a bubble. After reaching a peak in late 2021, overall sales have dropped in recent months. Will NFT versions of sports trading cards be more resilient?

Last year, fans spent hundreds of millions of dollars on Sorare cards. The company is currently valued at $4.3bn. Other start-ups, such as Dapper Labs and OneFootball, are pursuing similar ideas around sports and digital collectibles too. Geeks and jocks: finally teaming up.

Tim Bradshaw is the FT’s global technology correspondent

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