What Is NBA Top Shot? The New Crypto Platform Explained

Remember the appeal of buying and trading cards when you were a kid? There was nothing as special as opening a pack and finding a name, someone you knew would make your friends go nuts.

Today’s generation of fans might find that same magic through a new vehicle—owning highlights. Say it with me: Digital...crypto...highlights.

The surging new platform is known as NBA Top Shot. It hails itself as a “revolutionary new experience in which jaw-dropping plays and unforgettable highlights become collectibles that you can own forever.”

Not exactly. The NBA continues to own the rights to these video highlights, but fans are able to secure a limited-edition, numbered version of specific, officially licensed plays. Once these assets are in someone’s possession, they can trade and sell them.

It’s a digital collectible, a la blockchain (i.e., cryptocurrency, like Bitcoin). NBA Top Shot originated as a deal between the NBA and blockchain company Dapper Labs in July 2019.

Top Shot didn’t make much noise until this season, as it had accrued a meager $7 million in sales until last month, according to Darren Rovell of The Action Network. But it’s on the come-up now.

he NBA packages the highlights, then Dapper handles the rest. They decide how many of each clip to sell (i.e., how ‘limited’ an edition each clip will be) and assign a number to each clip. The number is key—people are really purchasing the number, not the clip itself.

These clips are then packaged into digital packs, which are listed for somewhere between $9 and $230, depending on the quality of the clips.

Once you buy a pack, the cards go into your digital wallet. You are on your way to stacking your (digital) paper.

The first thing you should know: they’re all sold out right now. So hold your horses and take a moment to breathe before you liquidate your 401(k) or sell all your sneakers.

As with sports cards, there are options for both the budget-conscious and high-rollers. You can (normally, when items are in stock) buy a pack for as little as $9. Similarly, on the secondary market, a Bismack Biyombo reverse layup is currently listed for $18. Not bad.

But it’s like buying a sweater—if you get one from H&M, it probably will feel nice in the moment, but won’t give you much long-term value. The bigger the player’s name, the more jaw-dropping the play, the bigger the potential rewards—and, of course, the higher the price tag. For example, this LeBron James dunk sold for $3,800.

And the numbers keep growing. Last week, FantasyLabs co-founders Jonathan Bales and Peter Jennings bought a Ja Morant highlight—a clip of him dunking over Aron Baynes in a clutch moment last year—for $35,000. (Of course fantasy guys are first to this market.) Not to be outdone, SnapBack Sports founder Jack Settleman led a group that purchased a James dunk for $47,500.

Fast! Like, Ja Morant fast.

The Morant clip drew publicity and Top Shot has raked in at least $1 million in sales each day since. Money trees are the perfect place for shade. Five clips have sold for at least $20,000—three were LeBron highlights, one Morant, and one Giannis Antetokounmpo.

Top Shot is closing in on $20 million in sales. Of note, some of that ($6 million) is coming from pack sales, but most of it ($14 million) has been generated on the secondary marketplace.

Consider the Morant card. It was purchased in a pack, then resold in November for $1,999. That owner held onto it until Bales and Jennings bought it for $35,000.

Shell out $2K, bring in $35K a couple months later—I guess making 17.5 times your investment is a decent return.

Now, of course, other versions of the Morant dunk have surged in price. Three sellers are currently offering their version of it for $100,000. As we said: there are multiple versions of each clip, but the more high-end clips exist in a limited quantity.

Ready to resell or trade a Top Shot? It’s as simple as selling your old Keurig on Craigslist.

Go to your digital highlight reel and select an item to put on the marketplace. It sells. You make money. Done.

Much like selling on eBay, though, the platform takes a cut of sales—so Dapper eats into the profits—and so does the NBA. This deal was shrewdly arranged in that both Dapper and the NBA get cuts of original sales and deals made on the secondary marketplace.

You can watch the clips anytime on YouTube. You don’t really gain anything by owning a Top Shot. So why is it worth anything?

Dapper Labs CEO Roham Gharegozlou explained his perspective in an interview with Rovell.

“There are guys buying trading cards and they’re never taking the custody of the cards before putting them into vaults,” Gharegozlou said. “There are people buying shares of cards on sites like Starstock, without ever seeing the card. This is the same concept. We have a lot of believers in what we offer and we have people who don’t get it. That’s OK. We can’t please everybody.”

They’ve also attracted some very loyal consumers, such as 29-year-old game designer and collector Pranksky, who spoke with Rovell and said he’s spent nearly $1 million on the platform. He’s been buying and reselling clips like crazy and said he currently owns around $3 million in highlights.

“This takes the traditional collectible into a modern, global era,” he said. “All markets are immediate and international. No longer do you have to wait for a card to be graded, or delivered, or fear of forgeries. Yes, the tradeoff is you no longer have that card on your mantelpiece, but in an age dominated by TikTok and Instagram, is that really what the younger generations want anymore?”

Indeed, Settleman said younger collectors are gravitating toward this platform. Back in my day, we wore shorts.

The sports trading card market is worth $5 billion to $6 billion per year, according to Gharegozlou, and he believes Top Shot could gross $1 billion annually.

It might sound far-fetched, but so did Bitcoin originally. Its stock value is approaching $50,000. It started trading for a few cents per coin in 2010.

Gharegozlou’s company likely won’t stop with the NBA. He hinted that his team is working on deals with other leagues.

So, in the next couple years, expect NBA Top Shot values to continue to grow, and expect to see NFL Top Shot, MLB Top Shot, and more.