“Most people are cheering, but at the same time, shaking their heads and going, when is the bust coming?” said Jane Leung, the chief investment officer at SVB Private Bank.
One of those who bought into the frenzy was Matthew Schorr, 35, a lawyer in Cherry Hill, N.J. For years, he has been on the lookout for hot investments, but lost interest in the stock market and abandoned Bitcoin after his friends dismissed the cryptocurrency as “fake money.” He now regrets that because the value of a single Bitcoin has soared above $57,000, meaning 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 out again. So starting in January, he spent $5,000 to buy 351 videos from NBA Top Shot, a site for trading basketball highlight clips, after he saw social media chatter about them selling for tens of thousands of dollars. The value of those clips has now soared to $67,000, according to Momentranks.com, which tracks the sales.
The clips are a type of investment known as NFTs, or nonfungible tokens, which have taken off in music, art and sports. The digital tokens use networks of computers to prove that a digital item like a video, image or song is authentic, giving the item a value — at least in the eyes of the person buying it. Some liken NFTs to digital trading cards. (The creators of the underlying works typically retain the copyright.)
Skeptics consider NFTs among the most questionable of assets, since an NFT image can be endlessly copied and shared. Still, enough people are convinced of the value of authenticating tokens that they have dovetailed with another market-propelling phenomenon, FOMO, or “fear of missing out.”
“I’m trying to keep my finger on the pulse and not let myself fall behind again,” said Mr. Schorr, who spends as much as five hours a day researching the market and chatting with fellow collectors on Discord. “That sort 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 started last year — including $47.5 million in sales on a single day.
www.nytimes.com 2021-03-13 10:00:23