BofA: Digital Card Pack Products Could Be a New Frontier for the Betting Industry

According to a new note from Bank of America, as the spread of regulated online casino games in the US is progressing more slowly than expected, digital card pack opening products, known as 'rip' apps, are creating a new space. Bank analysts believe these products could become an important vertical for operators seeking growth beyond sports betting.

According to the report, digital rip products recreate the physical card pack opening experience in a virtual environment and add liquidity through instant pricing. Users buy and open a pack virtually, then can choose to sell the cards back, keep them in their account, or have them physically delivered. Collectible cards range from sports cards to Pokémon. Analysts say the appeal comes from the chance of finding an extremely valuable card among ordinary ones.

According to Bank of America estimates, weekly active users rose from about 50,000 a year ago to more than 1.7 million. The category's annual revenue is approaching 2 billion dollars. According to an analysis based on blockchain transactions, annual gross sales volume is about 13 billion dollars. Weekly transaction volume also rose from roughly 14 million dollars to nearly 250 million dollars over the past year.

According to the blockchain data in the report, about 58% of rip transactions relate to Pokémon and 15% to sports cards. About 70% of volume comes from packs priced under 25 dollars. Separately, FanDuel announced a partnership with Arena Club. Underdog and PrizePicks offer rip products. The report also names Coinbase, Crypto.com and Betr among the companies that have entered this category.