Pokémon card winner Scaramucci says collectibles are asset class

Logan Paul, a social media influencer and wrestler, made headlines last week by auctioning off a rare Pokémon card for a staggering $16.5 million, setting a new world record for the highest price ever paid for a trading card at an auction. The card in question is the coveted “Pikachu Illustrator” card, dating back to 1998 and believed to be one of only a few dozen in existence.

The winning bidder, AJ Scaramucci, the son of former White House communications director Anthony Scaramucci and founder of Solari Capital, sees this purchase as an investment opportunity. This acquisition marks a significant milestone in Scaramucci’s budding career as a collector, which began during the COVID-19 pandemic with a focus on trading cards.

In an interview, Scaramucci emphasized the cultural significance of the “Pikachu Illustrator” card, comparing it to a Picasso painting in terms of its value to enthusiasts. Following the auction, Scaramucci revealed his plans for a “planetary treasure hunt” alongside his younger brother, aiming to acquire rare assets across various categories.

The surge in popularity of trading cards in recent years is evident, with Card Ladder reporting a nearly twofold increase in monthly sales volume in the secondary trading market over the past two years. EBay CEO Jamie Iannone highlighted the strong growth in collectibles, driven primarily by the continued demand for trading cards.

Scaramucci’s interest in Pokémon cards extends beyond personal enjoyment, as he views them as viable investment vehicles due to their impressive compound annual growth rates. He sees collectibles as a way to hedge against currency devaluation, positioning them as alternative assets with tangible value.

While some financial experts caution against viewing collectibles solely as investments, citing their illiquid nature and reliance on subjective valuation methods, there is a growing trend towards considering trading cards and other collectibles as legitimate assets. As more data becomes available and major sales like Paul’s auction garner attention, the appeal of collectibles as alternative investments is expected to increase.

Scaramucci’s future plans include launching a new venture called Treasure Trove, funded by Solari Capital, to further his quest for rare assets. While his aspirations to acquire iconic items like the Declaration of Independence may seem ambitious, his bold approach to collecting and investing underscores the evolving landscape of alternative assets.

In the world of high-stakes auctions and rare collectibles, Scaramucci’s pursuit of real-world treasures may seem unconventional to some. However, his passion for acquiring scarce assets and his willingness to push the boundaries of traditional investment strategies reflect a growing trend towards viewing collectibles as more than just hobbyist items. As Scaramucci aptly puts it, “If you think I’m just a crazy person buying up real-world, scarce assets, that’s all you need to know.”