Ok, I admit it.
No, really.
I admit to talking to you a lot about real estate.
Kind of comes with the territory of following the land market no?
And the fact that the study of land is not included in economic theories these days, it is important someone fill that knowledge gap.
At the same time, it’s also important to realize that the 18.6-year Real Estate Cycle that myself and my Property Sharemarket Economics (PSE) team members study is not solely driven by people buying and selling houses to each other.
There are various powerful and influential drivers of this cycle that are worth your attention.
One of them is commodities.
Another one is technology. And currently, now more than ever, they are intrinsically linked. As technology improves and innovates, this drives new opportunities for making money.
And as we have explained previously, this simply drives speculative activity up to an almighty boom.
The K-Wave
PSE study the land market, but we also track and study a phenomenon called the Kondratieff wave, named after the person who discovered it, Russian economist Nikolai Kondratieff. It also referred to as the K-wave.
The K wave is a rhythm of rising and falling prices of commodities across a “wave” which lasts approx. 50-60 years.
This research indicates we are on an up-wave of this commodity cycle.
Therefore, a large proportion of commodities are rising in price due to the demand for them and reduced stockpiles held by some of the world’s biggest exchanges (such as the London Metals Exchange).
This leads nicely then to technology.
The pace of technological progress requires more and more resources to satisfy an insatiable demand from society.
So, one trend drives the other.
But here is something you may not have considered. Previous cycles have culminated with a peak, but also with a long-term revolutionary piece of technology that literally changes the world.
Prior to the last real estate cycle peak in 2007, no-one on Earth owned an Apple iPhone.
Chances are you are reading this email on one of them now!
And for almost everyone, life is unimaginable today without your smart phone in your pocket.
Now think about the commodities required to make just one.
So, it makes me think, should history repeat, and we experience yet another land induced peak later in the decade, what type of technology will be unveiled to the world?
It’s hard to say today, given the pace of change.
What we can certainly look at today though are some of the most disruptive trends out there.
Ones that you may have never heard of before.
And which are literally minting millionaires as you read this?
Intrigued?
Do you perhaps want in?
Regardless, you’ll never guess what it is. Let’s look together.
You made how much profit with these?
When I think of new technology that demonstrates a different way to monetize someone’s passion, this is the type of company I enjoy researching.
So, have you ever heard of Top Shot?
Basically, Top Shot is a wonderful example of using an existing technology (blockchain in this instance) and developing a new economy around it.
It was created by a company called Dapper Labs. They use not-for-profit crypto coins (called NFTs’, or non-fungible tokens) to build a blockchain ledger that is used by a community to buy and sell digital collectibles between themselves.
Hence an online digital collectibles economy. Using a blockchain called “Flow”.
They first shot to prominence partnering with Animoca Brands to launch Crypto Kitties.
Yes, that’s right, your own collectible digital kittens!
Sounds like a lazy no harm bit of fun for young kids, right?
Last week they racked up close to $30 million dollars in sales revenue.
No, not for young kids at all.
And all done within its own collaborative online eco-system.
Top Shot however, dials this up a notch, and then some.
You see, Dapper Labs signed an exclusive agreement with the National Basketball Association (NBA) in the US to use live in-game clips of players to create a “moment” and turn them into a digital collectible.
Source – top shot website
These moments are a brief clip of specific action of a player in a basketball game either dunking, creating an assist, or blocking a shot in defense etc.
They are all packaged together into packs which are released by the company infrequently, and when they are all brought, that’s it, no more are made.
By using the blockchain, it assures buyers of their exclusive ownership and facilitates fair and transparent buys and sales through its own marketplace.
The way I look at this is thinking back to the footy cards I used to collect as a kid. Top Shot is exactly the same really.
I used to want all the base cards, so each team was complete, then as I earned more pocket money I went and brought whole boxes to increase my odds of buying a rare card, maybe even a signed one with its own certificate!
Then I’d go visit my mates and compare collections.
In real life, card collecting is a huge business. The collaboration with the world’s biggest sports like soccer and basketball mean a huge reach for these products.
It has an estimated market cap of $5.5 billion dollars. The focus for Dapper Labs is to start taking some of this market share.
In terms of Top Shots deal with the NBA, the ability to scale up are huge. In 2018 it was reported the NBA reached 1 billion unique viewers via its myriad of programming.
There are less than 50,000 owners on the Top Shot website currently.
Recently they broke through $60 million in sales. That’s since it launched in October 2020.
This trend has only just begun. The upside here is potentially off the charts.
And to demonstrate the type of demand online for these collectibles (remember, you can’t physically hold these, they are 100% digital that you store via online wallet) one needs only look at the most famous players in the NBA.
Take Lebron James; his name transcends basketball.
What sort of price would one expect to have to pay to secure an extremely limited minted edition of a James highlight? Well, I found one on their marketplace. #10 of only 32 produced.
Source – top shot website
And trust me, they get brought too. You can use credit card but it’s mostly crypto purchases.
You could have brought #25 of this limited edition run for just over $5000 back on December 28th, 2020.
What happens to these when the user base doubles, triples, quadruples?
The Real Estate Cycle can help you identify the risks here.
Now, regardless of if this is your type of thing or not, there are a few hard truths I need you to know.
These types of businesses are starting to flourish. But Top Shot is in beta stage.
So, your wallet as it were isn’t accessible right now. Whatever money you happen to make by trading, for now at least, cannot be taken out.
Here is my own personal number 1 rule when it comes to investing; how soon can I get my own money back?
And right now, cause its in beta, that answer isn’t clear, so beware.
But its envisaged in time, once fully released this will be rectified. Remember the addressable market they are trying to take share in.
As more and more licensed agreements get signed, we will shortly see similar digital eco-systems based on sports like Formula 1, UEFA Champions League etc.
I can certainly see someone signing exclusive digital rights to car manufacturers like Ferrari or Bugatti, and then create ‘moments’ from their extensive motoring history for collectors to bid on and own for themselves.
So, not only does that present opportunities for those of you who spend a lot of time studying and investing in the crypto and blockchain world, but they are in fact a microcosm of the 18.6-year Real Estate Cycle itself.
Let me explain.
What this demonstrates to us is the drivers that underpin the cycle, the human behaviour of speculation and greed and the ever-present fear of missing out on something, is perfectly encapsulated by Top Shot.
These types of eco-systems are not much different than the stock market or the real estate market.
Willing buyers meet willing sellers to determine what the pervading market rate is for a particular asset.
But the very worst behaviours I’ve studied in both the land market and stock market are already present with the Top Shot marketplace.
The practice of land banking, where large developers buy hundreds of acres of land, keep them off the market until prices are high enough to allow them to drip feed lots onto a hot market, is also happening here.
Thanks to the marketplace, it’s possible to determine the most valuable moments on the market and for one individual to buy up as many as possible and then release them ad-hoc to inflate their value.
And much like the stock market, where insiders can position themselves well before news ever becomes public, there are methods for buyers to use the blockchain to determine the likelihood of near-term minting of new player moments.
They can use that information in the public marketplace to sell high to unsuspecting buyers who aren’t aware extra supply is imminent and therefore a drop in prices will result for that player.
Same behaviour both in the real economy and in this eco-system.
But there is always another side to a coin.
You don’t always have to be on the receiving end of those who benefit from their inside knowledge of the system.
Did you know the same mindset can be used to your advantage also?
Whilst its easy to become the victim of such practices both online and in the real world, studying the 18.6-year Real Estate Cycle can provide the tools for you to “see” what truly happens in markets.
Unveil the habits and secrets of those who withhold this information from us, and then take full advantage yourself.
And most crucial of all, let the timing of a repeatable real estate cycle do the hard lifting for you.
If you have wanted to understand what really drives the real estate and stock market and wish to expose yourself and your capital to marketplaces like Top Shot, then I have some good news for you.
Likewise, those of you who maybe have enjoyed success in a similar marketplace like the one described here and want to expand your investment horizons, here’s an opportunity to gain knowledge that can help you in both.
It’s called the Boom Bust Bulletin.
As a member of the Boom Bust Bulletin. You will receive the history of the 18.6-year Real Estate Cycle, why it repeats, and how you can take full advantage for yourself and your family.
Upcoming editions will explore the relentless rise of technologies, like Top Shots marketplace, and explain to you why at the end of the day, they are all part of the same boom-bust cycle.
With the same timing, same opportunities, and same risks as each other.
You will find the information this bulletin provides you nowhere else.
It is 100% exclusive to Property Sharemarket Economics.
And it will cost you less than a single coffee per month. Or the same as a Base Rui Hachimura moment!
Incredible value.
Join us on this journey.
Sign up now.
Best wishes
Darren J Wilson
and your Property Sharemarket Economics Team
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