Trading card apps promise cash for daily bills, sparking gambling concerns

Digital trading card platforms are facing increased scrutiny for advertising them as a way to make money for rent, groceries, and other everyday expenses through randomized purchases of sports and Pokémon cards. The practice has raised concerns about financial risk and gambling-like behavior, Barron’s reports. According to the outlet, platforms such as Rips and Packed have promoted digital trading cards as possible sources of cash, even though buyers can end up losing money on their purchases.

Unlike traditional trading card packs, digital platforms allow customers to buy randomized cards online. Buyers can usually choose to have the physical cards shipped to them or sell them back to the platform for a set amount. The financial risks can be significant.

Rips says customers buying a standard pack have about a 50% chance of getting a card worth less than what they paid. On Packed, a $100 pack has at least a 70% chance of producing a card with a lower value, Barron’s reported. The growing market has also attracted investment from companies tied to sports betting and digital collectibles.

DraftKings took part in a $24 million funding round for Triumph, the startup behind Rips. That deal valued Triumph at $308 million, according to Barron’s. Fanatics, Underdog, PrizePicks, and Crypto.com have also moved into the digital collectibles space.

Industry officials say these transactions are legitimate retail purchases rather than gambling. PrizePicks Chief Legal Officer Jason Barclay has described the company’s digital card products as e-commerce transactions. Still, concerns persist about the potential for compulsive spending.

Triumph’s responsible purchasing policy directs customers to resources commonly associated with gambling addiction. The advertising practices have also prompted questions about regulation. The American Gaming Association discourages sports betting ads that present gambling as a solution to financial hardship, while Massachusetts limits certain gambling promotions that promise winnings.

Those rules may not clearly apply to digital trading card platforms, since their legal status is still being debated. RELATED CONTENT: Damon Jones Pleads Guilty In NBA Gambling Scandal