Happy Monday, readers! We’ve got the 0xResearch crew taking over The Breakdown this week while Byron is out of office. Get ready for alpha and juicy market updates headed your way. Enjoy!

Is CARDS about to rip? 

If you have been following my work, you would know that I am a huge onchain collectibles bull, and the best proxy for that trade continues to be Collector Crypt. While BTC has pumped close to 30% from its $63K lows, CARDS has fallen 8% over the same period. So what has caused this, and is the collectibles trade over?

I view Collector Crypt’s current user base as Web 3 native memecoin and NFT degens looking for a quick dopamine hit. While these users can be big spenders on gacha machines, and they were, they are quick to move their capital when the next shiny object comes along. Most recently, that has been the memestock pairs going viral across Robinhood Chain and Solana.

This pulled capital away from the onchain collectibles space. You can see net revenue peak at $3M in the week ending August 16, just before launchpad volumes started taking off.

It really cannot be a coincidence that Collector Crypt’s metrics started falling just as launchpad volumes increased. But guess what? That is now starting to flip. Collector Crypt’s net revenue has bounced back after three weeks of decline and has put in two strong weeks as launchpad volumes have fallen.  

Over the same period, the team has added new gacha machines to cater to the rising popularity of Riftbound and Dragon Ball packs. For those who have been to physical TCG conventions, you would know that these two TCGs have been heating up, almost like higher beta versions of the Pokémon and One Piece card price rally this year. I love how quickly the team has adapted to trends in the market, with these two categories accounting for 8% to 16% of gross revenue in recent weeks. 

But what will be the aha moment that brings Collector Crypt back into the spotlight and drives its next leg up? One catalyst continues to be slept on by the market, and that is the launch of Ripmart, which few people on the timeline seem to be talking about.

While few details have been officially announced, the clues on the timeline point to a consumer facing live shopping app similar to Whatnot. For comparison, Whatnot has raised $545M at a $20B valuation, highlighting just how big the live shopping experience has become. This is how I envision the model working.

Ripmart could let users buy packs from Collector Crypt’s sealed inventory and watch streamers open them live. Users could then instantly sell eligible hits back and use the proceeds to buy more packs. The potential edge over Whatnot is that built-in buyback, which keeps spending power inside the platform and the ripping loop going. It is similar to the existing gacha process but a lot more entertaining and focused on sealed inventory.

Live streams of Pokémon pack openings have become huge in the TCG space, with accounts such as Deep Pocket Monster attracting 1.7M followers on Instagram. I personally get hooked watching packs being opened, especially the thrill of seeing someone open a vintage pack. While the exact economics between Collector Crypt and Ripmart are not known, this could give Collector Crypt a deeper foothold in the Web 2 consumer market and allow its volumes to diverge from crypto market liquidity flows.

CARDS is one of the few tokens on my long term holdings list that I am comfortable holding across cycles. My criteria are based on projects that add genuine value for users and revolutionize existing processes. Think about it. A first edition Charizard recently sold for $600K through Collector Crypt’s swap tool without the marketplace fees of at least 10% charged by auction houses or eBay.

Within a year, the project has crossed $1B in gross revenue and $100M in net revenue, built out its own vaulting facility and integrated with numerous partners. 

That is a lot of progress in a short period, and Ripmart could give the business another leg of growth. Blue skies ahead. Speaking of ripping, the Pokémon 30th Anniversary booster box dropped last week with cute Pikachu artwork in each pack, so rip away, my friends. 

— Kunal

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