“Most people cheer, but at the same time they shake their heads and go, when does the bust come?” says Jane Leung, Chief Investment Officer of SVB Private Bank.
One of those who bought the madness was Matthew Schorr, 35, a lawyer in Cherry Hill, NJ. He has been on the lookout for hot investments for years, but loses interest in the stock market and leaves Bitcoin behind after his friends dismiss the cryptocurrency. as ‘fake money’. He regrets it now because the value of a single Bitcoin is higher than $ 57,000, which means that the eight Bitcoin he paid for a Domino’s pizza in 2011 would be worth more than $ 450,000 today.
Mr Schorr did not want to miss again. So in January, he spent $ 5,000 buying 351 videos from the NBA Top Shot, a website that trades basketball highlights, after watching social media sell for tens of thousands of dollars. According to Momentranks.com, which tracks sales, the value of these tracks has now risen to $ 67,000.
The tracks are a kind of investment known as NFTs, or non-flammable signs, that have risen in music, arts and sports. The digital signs use computer networks to prove that a digital item such as a video, image or song is authentic, giving the value a value – at least in the eyes of the person buying it. Some compare NFTs to digital trading cards. (The creators of the underlying works usually retain the copyright.)
Skeptics consider NFTs to be the most dubious assets, since an NFT image can be endlessly copied and shared. Yet enough people are convinced of the value of verifying signs that unite them with another market-driven phenomenon, FOMO, or ‘fear of missing out’.
“I try to keep my finger on the pulse and not fall behind again,” says Mr. Schorr, who spends as much as five hours a day researching the market and chatting with fellow collectors on Discord. “That kind of return over six weeks is completely unheard of in any financial vehicle.”
Last month, NBA Top Shot crossed $ 232 million in total sales since it began last year – with $ 47.5 million in sales in one day.