Can Phygitals Bring the Popularity of Pokémon Cards into the Crypto World?
Written by: Umbrella
In the past half month, the popularity of the Pokémon card RWA track has surged, primarily due to the token CARDS of the Pokémon card trading platform Collector Crypto, which achieved nearly a tenfold increase in just two weeks.
At the beginning of September, CARDS was issued at a price of $0.04, and in recent days, the price has consistently broken new highs, approaching $0.4, with a fully diluted valuation exceeding $668 million.
Such rapid growth has brought the Pokémon card RWA niche into the spotlight, and the card pack mechanism that combines blind box opening with Pokémon IP nostalgia has triggered market FOMO. According to Dune data, in the past week, the top four platforms in the TCG (trading card game) track generated a total of $31 million in card pack sales.
Recently, another platform in the Pokémon card RWA track, Phygitals, has attracted market attention and discussion. A series of recent actions by Phygitals seems to hint at an upcoming token launch, and many investors who missed out on CARDS are now pinning their hopes on Phygitals.
A Canadian Startup Refusing VC
From a hackathon prototype to gaining recognition through market validation, Phygitals seems to carry a distinct style.
Phygitals can be traced back to the Solana hackathon in January 2023, where founder "Mister Colada" proposed the concept of a "tokenized trading card market." After nearly two years of refinement, it officially launched its public beta version in February 2024, and the card trading market began operations in March of the same year.
Unlike most crypto projects that seek VC funding early on, the Phygitals team has adhered to a zero external funding approach. The project team has repeatedly emphasized in public that they do not need VC or financing.
This idealistic persistence not only avoids the liquidation pressure brought by VCs but also maintains the purity of the project. However, it also means that its growth relies entirely on cash flow. Fortunately, based on the current popularity, the Phygitals team's persistence has paid off—according to DeFillama data, the Phygitals platform generated over $2.4 million in transaction fees in the past two weeks.
A New Card Collecting Experience
Phygitals Official Website Link
The core of Phygitals' product is to completely digitize the traditional card pack opening process, ensuring that digital cards correspond one-to-one with physical cards and have sufficient liquidity in the secondary market. The Pokémon NFTs obtained from opening card packs can be exchanged for corresponding physical cards and can also circulate in the secondary market, eliminating issues such as low liquidity, high logistics costs, and authenticity verification challenges in traditional card trading.
Users can choose different priced card packs to open on the Phygitals platform, priced at $1, $25, $50, $80, and $250, with higher-priced packs having a greater probability of obtaining rare cards. Due to its recent popularity, the current $80 card pack has even shown a "sold out" status.
Phygitals' biggest innovation lies in its support for users to instantly repurchase the cards obtained from opening packs at 85%-90% of the current market fair value. This mechanism introduces a market maker-like liquidity mechanism to the card trading market, effectively solving the long-standing liquidity issues in the NFT market.
Currently, Phygitals allows users to sell cards back to the platform within 30 minutes of opening a pack at 85%-90% of the fair market value, and in the future, Phygitals plans to extend the repurchase window to 7 days. This design also gives digital cards liquidity close to that of fungible tokens.
In addition, Phygitals has recently hinted at entering its "second phase." The content displayed on its official website and Twitter suggests that Phygitals may focus on developing social features, launching live streaming, and allowing more users to watch streamers open packs and try the unpacking experience themselves.
From this series of mechanism designs, it is clear that Phygitals is placing significant emphasis on "liquidity," providing a reassuring repurchase mechanism and liquidity for all "unpacking" users, undoubtedly encouraging more card enthusiasts to purchase packs without hesitation. The blind box attribute of the packs, combined with the nostalgic value of the Pokémon IP for a generation, has led countless users to fall into FOMO, eagerly opening packs and showcasing their experiences on social platforms, creating viral marketing.
Token Launch Imminent? How to Get Airdrop Expectations
Although Phygitals has not released any information regarding token economics, multiple signals seem to indicate that its token issuance is in preparation.
On September 12, Phygitals tweeted a hint that "something big is coming."
Combined with the previously launched mechanism for obtaining corresponding points from opening packs, as well as the team's hints that accumulated points and holding Phygitals-issued NFTs may yield future rewards, many users speculate that Phygitals is about to issue a token. This discussion has also attracted a group of users who missed the tenfold increase of CARDS to join the unpacking army of Phygitals, trying to seize another leading opportunity in this track.
At this stage, users can earn different point rewards by purchasing card packs of various prices in the "Packs" section of the Phygitals official website, with each pack purchase yielding points equivalent to one hundred times its price.
Considering the different probabilities of card levels obtained from different tier packs, as well as Phygitals' repurchase mechanism, if one wants to earn points for future airdrop expectations, choosing the $50 or $80 packs currently offers a better cost-performance ratio. Of course, opening packs is also a blind box process, with a very small chance of obtaining high-level rare cards, while the greater probability is to obtain ordinary-level cards that the platform will repurchase.
According to some users' experiences with opening packs, the ordinary-level cards obtained from the $25 pack have a repurchase price of about $13-$25, where lower-level cards can be automatically repurchased by the platform at 85% of the fair value, while slightly higher-level cards require confirmation of the repurchase price. However, due to the randomness of card levels obtained from packs, this data should only be used as a reference.
Although a series of actions seem to indicate that Phygitals is likely to issue a token soon, the current token issuance remains speculative, and investors need to be aware that unpacking packs carries a high degree of uncertainty.
The Duality of Market Feedback
Currently, market feedback on Phygitals shows a clear polarization, with excitement over high-value card pulls and skepticism regarding the authenticity of pack probabilities.
Positive feedback mainly focuses on its liquidity and physical card exchange. Phygitals' staunch supporter @Legendarygainz shared on Twitter that he opened a $3,000 misprinted card on Phygitals, confirming the existence of high-value cards in Phygitals' pack inventory.
Another Pokémon card collector, @pominik, shared that his experience exchanging digital cards for real cards on Phygitals was very smooth.
On the other hand, criticisms of Phygitals in the market mainly point to its transparency regarding probabilities. Some users reported repeatedly pulling low-value cards from high-end packs, suggesting potential algorithmic bias. Additionally, many users on Twitter opened the same card at the same time, raising market suspicions of possible collusion with the platform for false marketing using the same materials.
Overall, the positive voices in the market regarding Phygitals account for more than half, with most users and KOLs believing that Phygitals can take over from CARDS, elevating the market's FOMO sentiment to a new level.
Phygitals currently stands at the intersection of a trillion-dollar collectibles market and the emerging RWA track. Although it faces numerous doubts, it is undeniable that a FOMO sentiment for unpacking packs has already emerged in the current market, and many friends around me are willing to spend dozens of dollars to enjoy the process of unpacking blind boxes.
Whether it's Collector Crypto or Phygitals, both have achieved a good integration of Pokémon cards and crypto technology. After CARDS, more users from both inside and outside the card RWA trading track are eagerly awaiting the next opportunity. Let us look forward to whether Phygitals can bring the popularity of Pokémon cards into the crypto world.
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