2015-12-14

The speculation market of everything

Sometimes it is very interesting to take a step back and look at how we act in the modern world. We seem to be striving for passion and excellence in everything. If it can be compared, we are becoming connoisseurs in it. If it can be done, we will compete in who can do it best. And if it can be sold, it is very likely there will be plenty of room for us to speculate on.

Magic the Gathering and Bitcoin


Magic the Gathering and Bitcoin have some interesting history. One of the first and biggest Bitcoin exchanges originated from "Magic the Gathering Online eXchange" - MtGox. However, that is not the story we'll be talking about today.

A few months back at /r/Jobs4Bitcoins subreddit someone was paying people to buy out and burn some Magic card - Seance. Fast forward a few months to 5 days ago and the same user offered a bounty of $40k to a any pro tournament player who would build and play a deck in a Magic tournament around that specific card (the text of the original thread appears to be removed unfortunately). Some people are already putting up some theoretical decks around it, while a lot of people are asking what's going on. Some more astute redditors have already seen through to the real motivation behind those actions - market manipulation.

Yes, it looks like speculating on the market of Magic the Gathering cards is an interesting investment. If a card becomes popular to play in some tournaments and it is in limited supply, it can appreciate in value.

Even if you are not affecting the market, there seem to be a lot of people speculating on price of various cards. Some are also gambling on opening packs of old cards in full latex gloves in hopes of finding mint condition rare cards to later have them sealed and graded for resell value.

The unregulated, legal inclusive investment market of... sneakers


Collectible card games is not the only game in town when it comes to speculation, investments and human ingenuity when it comes to making money with a passion. Apparently, the secondary market for Nike shoes is quite interesting:


If you are savy enough, you can build your own portfolio of shoes, track its worth over time, and hopefully gain better return than investing in Apple stocks. The resell market for Nike shoes is apparently even bigger than the actual market for Nike's biggest competitor... Just watch the video - it's fascinating.

Everything else


It seems that this sort of behaviour is rather common in many places. Awhile back someone in the EVE Online subreddit described how he made his Internet fortune buying and selling limited-edition items (unfortunately, the original thread seems to be deleted). His total net worth was about 2.5 trillion ISK, worth about $40k at today's PLEX value of $20 - 1.2 Billion ISK (explanation on how this works). There are plenty of other stories from the EVE universe on people creating monopolistic cartels or speculating on future patches.

Of course, a lot of people will also point out the notable stories of Beanie Babies and the Tulip Mania bubbles and they would be right to do so. Collectors markets are inherently speculative and sitting under the Damocles Sword of the company that is creating the items. If they created it once, they could recreate it again and destroy any value such items would hold.

The future?


With all that being said, it would be interesting to see more sophisticated speculation markets pop up for collectible commodities. Being able to invest in portfolios of art, speculate on drug research, short some overhyped videogames, or perhaps bet on whether or not a terrorist attack might take place.

If there is money on the line, there is a room for a speculation market...

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