Crypto Platforms Tokenize Pokémon Cards to Fix Slow, Fragmented Trading Infrastructure

Woofun AI reports that a frenzy for Pokémon cards has erupted at retail outlets, highlighted by a high-profile sale of a Pikachu Illustrator for $16.5 million by influencer Logan Paul to AJ Scaramucci, founder of Solari Capital and son of financier Anthony Scaramucci. This surge in demand is evident in the early morning queues outside a Costco in British Columbia, where buyers waited hours for 'Prismatic Evolutions' cards priced at C$100, only to see them resold on secondary marketplaces like Facebook Marketplace for multiples of their retail value. The intersection of pop culture collectibles and high-net-worth investment is no longer niche; it is a defining characteristic of the current trading card landscape, driven by both nostalgic appeal and speculative fervor.

The retail sector is responding to this demand with significant inventory adjustments and restrictive measures. Target reported a nearly 70% increase in trading card sales last year, largely attributed to Pokémon, and has committed to expanding the physical store space dedicated to these items as part of its broader growth strategy. Similarly, Walmart observed a 200% jump in trading card sales on its online marketplace over the same period. To mitigate the impact of scalping, which drives secondary prices far above retail, both major retailers have been forced to impose strict purchase limits on trading cards. These constraints, while intended to ensure fair access for genuine collectors, have inadvertently fueled the secondary market, where scarcity is artificially manufactured and monetized.

Market valuation estimates vary significantly depending on the methodology and the firm conducting the analysis, but the consensus points to a multibillion-dollar industry. eBay, the largest marketplace for these cards, recorded $2.62 billion in sales in 2025. In terms of performance, Pokémon cards rose 28% this year, outperforming both the S&P 500, which was up about 13%, and bitcoin, which was down 29%. Kovoy VC, a firm investing in gaming platforms and tech, pegged the market value at around $13 billion in 2024. Mordor Intelligence projects the market to reach around $15 billion in 2026.

Meanwhile, TCGCharts estimates that the market cap of every 'graded' card is around $10.8 billion today. These figures underscore the transition of trading cards from hobby-store collectibles into an alternative asset class with substantial financial weight.

Despite the booming market, the infrastructure required to trade these assets quickly and efficiently has not kept pace with the explosion in popularity. Collectors are still burdened by a 1990s-style process that involves waiting weeks or months for cards to be graded, listing them on inefficient marketplaces with high fees, and shipping them via snail mail. This antiquated system is increasingly at odds with the expectations of a new generation of investors accustomed to transacting financial assets within a fraction of a second.

In response, a new class of platforms is emerging, betting that blockchain technology can replace these legacy mechanisms. Deadstock, the first platform from startup ATH Labs, is at the forefront of this shift. Based in Abu Dhabi and co-founded by Dominic Jang, a longtime Pokémon card collector and traditional finance veteran, ATH Labs runs a closed beta of its platform on the Arbitrum blockchain. Bullish Capital, the venture arm of CoinDesk's parent company, has invested in the company, signaling institutional interest in this novel approach to collectible trading.

The core mechanic of ATH Labs' strategy involves the tokenization of physical assets, specifically high-value, professionally graded Pokémon cards. The company aims to place physical cards, primarily 'PSA-10s' (cards receiving the highest grade awarded by Professional Sports Authenticator), in a secure, professionally managed vault. Each physical card is then matched one-to-one with a digital token representing ownership. This token can change hands instantly while the underlying card remains in storage, moving only when an owner chooses to redeem it for physical delivery.

This process mirrors the tokenization of other physical assets such as gold, Treasury bills, stocks, and private credit. By leveraging blockchain technology, proponents argue that costs are reduced, settlement becomes more efficient, and around-the-clock trading of assets is enabled. ATH Labs argues in a recent research report that 'there has never been a central registry or clearing house for this market,' and that this fragmentation creates a unique opportunity for blockchain-based ownership and settlement infrastructure.

Woofun AI data shows that competitor platforms are also gaining traction, demonstrating early evidence of demand for trading vaulted physical collectibles on crypto rails. Courtyard, one of the best-known platforms in the trading card space, offers digital packs whose contents correspond to physical collectibles held in a vault. It currently processes roughly $139 million of volume over 30 days and is running at an annualized fee of about $48 million. Other blockchain platforms tokenizing trading cards include Collector-Crypto, which reported $148.2 million in annualized fees and $77.8 million in 30-day volume, and Phygitals, which recorded $15.2 million in annualized fees and $7.4 million in 30-day volume. These figures suggest that while the market is still nascent, there is a measurable appetite for digital ownership of physical collectibles, driven by the convenience and speed of blockchain transactions.

Venture capital commentary reflects a shift in focus toward tangible, high-demand assets. 'For years, we tried to make RWAs work. we got stuff like tokenized credit facilities for shoddy motorcycle loans in east africa. turns out people just wanted tokenized psa 10 first edition shadowless charizards,' said VC firm Paradigm's general partner, who goes by 'Frankie,' in an X post. This sentiment highlights a preference for assets with clear cultural value and scarcity over complex financial instruments.

Additionally, Asia-based MemeStrategy has entered the market, claiming to have launched the 'world's first' tokenized Pokémon trading card fund, designed to offer professional investors access to PSA-10-graded 'Pikachu with Grey Felt Hat' trading cards.

However, House of Chimera, a crypto research firm, notes that much of the volume on these platforms comes from gamified pack openings and instant buybacks rather than traditional peer-to-peer trading, warranting caution in interpreting these metrics as pure liquidity indicators.

ATH Labs is attempting to differentiate itself by focusing on supply chain advantages through a strategic partnership with Japan Trading Card Center (JTCC). JTCC operates a large Japanese online marketplace for mystery card packs and is described by ATH's Jang as 'single-handedly the largest buying stream in Asia.' The agreement grants Deadstock 'exclusive' access to tokenizing JTCC's inventory and sourcing network. According to publicly available documentation, JTCC booked about 2.4 billion yen in profit for the period from Dec. 2024 to Nov. 2025 and had total assets of 6.9 billion yen.

Jang argues that this partnership provides ATH with a continuously replenished pool of cards that would be difficult for a new Western platform to replicate. 'Access to JTCC's supply, one of the world's largest liquidity streams in the trading card space, gives Deadstock an unfair advantage most platforms can never reach: deep, continuously replenished real-world inventory at scale,' said Jang. This direct access to Japan's dense ecosystem of specialist card stores allows ATH to source inventory closer to the source, bypassing the multiple layers of dealers typical in Western markets.

However, a critical challenge remains: liquidity. eBay continues to dominate the industry as the primary source of price discovery and liquidity in the trading card sector. More than $2.62 billion worth of individual trading cards changed hands on the marketplace in 2025, including about $837 million of trading-card-game and non-sports cards. This tally does not include sealed boxes, packs, sets, or lots, meaning the broader card business conducted on eBay is even larger. The network effect creates a chicken-and-egg problem for platforms such as Deadstock.

A seller is naturally drawn to the venue with the largest number of potential buyers, while buyers benefit from a deep history of completed sales that help establish a card's actual value. Transferring ownership on a blockchain may allow a trade to settle almost immediately, but it does not guarantee that a counterparty will be present. A tokenized card trading among a small number of users could be less liquid—and harder to price—than the same card listed on an established marketplace, particularly given that minor differences in condition, centering, or provenance can produce large price disparities.

Ultimately, the success of these platforms hinges on user experience and the ability to make the blockchain largely invisible to collectors. ATH argues that traditional marketplaces carry inherent issues, such as repeated shipping, marketplace fees, and the risk of inauthentic items. On Deadstock, a card is authenticated before entering the system and remains in custody while ownership changes hands, ensuring that 'they will get what they bought right away,' said Jang.

However, speculative assets like Pokémon cards are driven as much by nostalgia, scarcity, and online attention as by cash flows used to value stocks or bonds. A record-setting sale does not guarantee future liquidity. The harder question is whether enough collectors will choose to trade a token rather than list the card on eBay, take it to a convention, or simply keep it in a binder. This marks a pivotal moment for the intersection of physical collectibles and digital finance, where infrastructure must prove its utility beyond mere novelty.