Challenge Completions & The 4-Day Frenzy Surrounding Them
Just four short weeks ago, Top Shot (TS) took a giant step up in the NBA landscape by becoming the official platform that the Rising Stars (RS) rosters were announced on. In concert with this huge partnership, came an action-packed All-Star weekend where we saw four separate Seeing (SS)/Rising Stars pack drops in a matter of 3 days. Then, less than two weeks after the All-Star Game (ASG) ended, we were graced with another rare pack drop of ASG highlights.
All the All-Star weekend fanfare led to a significant change in the TS challenge dynamics. In February, it was not uncommon to see the challenge tab only have one or two active timers, but in recent weeks it seems like five has been the minimum. It’s easy to see why the TS community is feeling a bit of challenge fatigue this week as all the timers come to an end, and every moment drops 40-60% immediately. Before we dive into the specifics for these challenge dynamics, here’s a quick recap chart showing some of the basics for Part 1 of all these Challenges.
As many of you have seen from tracking my Google Sheet, there are a few distinct time frames leading up to and trailing after the challenge timers run out. I’ll give my take on each of these and try and provide clarity to where these trends could be headed. First up, the 2-day period before the challenge ends.
Prior to Challenge Completion – 48Hr & 24Hr Marks
All three of the challenges saw roughly a -10% low happen between the 48Hr and 24Hr mark. In ASG1, all moments rebounded and ultimately finished the challenge above this point. In SS1, this low point was a bit extended and generally encompassed the 24Hr mark, and in RS1 almost half of the moments finished the challenge below this low point.
With less than 24Hrs left in the Challenge, both ASG1 and SS1 saw consistent runups averaging in the +11-13% range relative to the 24Hr mark. The bulk of moments came down from this peak and finished their respective challenge at a small positive compared to their 24Hr number. The RS1 was again an outlier as there wasn’t any subsequent runup and only Lamelo Ball and Rui Hachimura finished the challenge above their 24Hr price points.
Where I think this will trend: It’s important to consider that a lot of people were a part of the psychological “burn” from the SS1 challenge the day before (which I will get into below). I think this impacted how the RS1 challenge ended. People were not anxious to complete it after witnessing the mass sell-off 24 hours prior. Over time, I expect that challenges will more closely mirror ASG1. A slight dip following the 48Hr mark will be the final opportunity to buy-in. Then, moments will continue to rise until challenge completion as more collectors start to understand the rarity of the reward mint count. Ultimately, I think we will get to a point where the best time to sell your straggler moment(s) is at the end of a challenge.
Let’s take a look at the height of the frenzy now!
Challenge Completion & the 1-2Hr Ensuing Mayhem
Across the board, we see a massive initial dip as challenge completers flood the marketplace to undercut their way to a massive loss (-40-60%). For those brave enough to wait 30 minutes, the moments generally all see a quick rebound (+30-60%) before ultimately levelling out below their challenge completion price. For ASG1 the moments stabilized around -20% compared to completion, while SS1 and RS1 were closer to -50%.
For those looking to turn a quick profit, this massive pricing mayhem is actually one of the easiest to navigate. Wait 20-30 minutes after a challenge completes, and then buy one at lowest ask (or two if you’re quick). Immediately re-list the moment at a +30-50% margin, and wait until the top of the hour. If the clock changes and you haven’t already gotten pinged with the red notification bell, adjust your listing slightly to match lowest ask and you are making money honey!
For those who completed the challenge (and those laughing at them from the Discord), this period of mayhem is equal to psychological warfare. Since your challenge reward doesn’t hit your account until later that night, it’s easy to keep that upcoming value out of sight and out of mind. Instead you are seeing 10+ moments in your collection hit all-time lows and potentially kicking yourself for thinking this was a smart decision a week ago.
Where I think this will trend: Until we see a more “fair” balance between the quick-flippers and the challenge completers, I think challenge utility (inherent value a moment carries) will continue to drop. This is good, because challenges are marketed towards the long-term collectors and a 50%+ utility doesn’t support that. There are two ways to capitalize on this until we see that happen. First, continue to factor in the reward to your post-challenge calculations (or just go click on the “Current Challenges” tab of my Google Sheet). Even this morning I saw people in Discord worrying about their SS2 collection hitting all-time lows, but based on my post-challenge calculations this is actually the most positive value the SS2 challenge has seen (currently trending at +$518 relative to Lowest Ask). Second, try and work your way into the 1-2Hr dip and capitalize on some quick flips. As I documented this afternoon on Twitter, that doesn’t always work in your favor, but theoretically there should be opportunity there.
And finally, let’s look at the 2 days after the challenge ends.
Post Challenge Completion – 24Hr & 48Hr Marks
As I reviewed this timeframe across challenges, the relative length of the ASG1 really stood out to me. Being only a third of the length of SS1 and RS1, it makes sense that the moments didn’t see as steep of a drop off post-Challenge. People didn’t have as much time to scrutinize market trends and become emotionally charged by their investment decisions with this collection compared to the others. Another thing that this helps highlight is that players and serial count matters. The more established All-Stars held their value much better than the unproven Rising Stars, and when compared to themselves, the rare set (ASG) held more value than the common set (SS). Both of these things make sense, which is a comforting sight to see from a market that oftentimes acts exactly the opposite.
Where I think this will trend: With the most recent Holo Icon, Metallic Gold Limited Edition (MGLE), and SS Challenges all kicking off at the same time, it’s clear that TS wants to try and have multiple entry points available to collectors at any given time. I think this will help concentrate the user base a little bit more and in turn it could help steady these post-challenge trends.
The other foot to drop is people starting to value the post-Challenge rewards more. It jumps off the page that each of the reward moments followed a very different pattern than the commons. It’s crazy to me that people are willing to spend $1000s of dollars on a challenge and then the second they get the reward, they immediately try and undercut the lowest ask to sell it for a net loss.
While the recent fad of listing your reward for $69,420 is a funny trend to watch, it highlights a future-state that may occur from challenges. Whether it be listing at $69,420 or just not listing at all, the supply is greatly reduced when people decide to hold long term. This drives demand up, which in turn favors the collectors who just spent their time and money completing the challenge. Almost seems too simple right? (Go convince your 4,181 other KD SS friends of this!)
Bold Prediction: The Seeing Stars 2 Challenge will be the first one we have seen (since January), where the the 24Hrs Post-Challenge Set + Reward will be worth more than than the set at time of completion. Would be incredibly ironic since the reward is Lebron James, the TS King himself.
I hope you’ve enjoyed the first edition of Show Me The Data. I have been blown away in the past 48 hours by the support from the Top Shot community and I am beyond stoked to get this project up and running. My weekly (sometimes more) articles will follow a similar pattern to the above. Plenty of data mixed with some long-form analysis. I will continue to fine-tune this over the next few weeks, but my goal is for the information presented to always be actionable!
As a reminder, here is the current rollout plan for Show Me The Data:
4/1 (today) – First Newsletter (you just read it)
4/5 – Google Sheet is Available to Substack Subscribers Only
4/7 thru 4/9 – Daily Value Emails begin for all subscribers
4/12 – Google Sheet & Daily Value Emails available to PAID Subscribers only