The Vancouver company behind NBA Top Shot is getting some major support from investors that include basketball legend Michael Jordan and other star athletes.
Dapper Labs is receiving more than US$305 million in funding from investors that include Jordan and current NBA stars such as Kevin Durant, Kyle Lowry and Klay Thompson.
Dozens of other NFL players and Hollywood celebs are also backing the company, which says it will use the infusion of cash to branch out into other sports and entertainment products.
NBA Top Shot is a platform that allows users to buy, sell and trade their favourite NBA highlights as digital tokens. The cryptocurrency technology blockchain is used to allow the creation of permanent certificates of ownership that can’t be copied or deleted.
Fans can buy packs of cards from the Top Shot website that can cost as little as US$9. More expensive packs with more and rarer cards can cost almost US$1,000.
One highlight of a LeBron James dunk recently went for US$210,000.
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Non-collectors may wonder why someone would pay for a sports highlight that can be viewed for free online.
Aaron Perzanowski, a law professor at Case Western Reserve University and co-author of the book The End of Ownership, said the frenzy around NFTs are in part a response to consumers’ genuine desire to reclaim a sense of ownership in an increasingly digital, intangible economy.
“Granted, right now, that desire is expressing itself through a seemingly frivolous and exploitative trend that, to most of us, looks irrational,” Perzanowski said.
Toronto-based tech entrepreneur Sheetal Jaitly said NBA Top Shot is a modern spin on sports collectibles.
“If you ever collected hockey cards or baseball cards, right away you’ll get it,” he told Global News earlier this month.
“For people who never found value in those things, they probably won’t get it. In the NFT world, you’re owning a piece of history, essentially.”
Jaitly said he had spent about $500 on NBA Top Shots, which have risen in value by “more than 1,100 per cent.”
— With files from Anne Gaviola, The Canadian Press and The Associated Press