31 Thoughts: Why NHL is exploring the NBA Top Shot trend

Edmonton Oilers forward Connor McDavid celebrates a goal versus the Columbus Blue Jackets. (Andy Devlin/Getty)

• Will NBA Top Shot come to the NHL?
• Kekalainen backs Tortorella
• Trade landscape a buyer’s market

Jesse Schwarz is laughing before the question is finished.

“I got a couple of messages like, ‘Have you lost your mind?’” he says from Los Angeles. “Someone tweeted at me, ‘You could have a small family home, but cool.’ But I love it…. It’s like day-trading-meets-sports-meets-fantasy.”

Last week, Schwarz created big-time buzz when he purchased a LeBron James “moment” on NBA Top Shot for $208,000. If that sentence sounded like sixth-century Cappadocian to you, here’s a basic explainer: This is the evolution of sports-card trading for the digital world. Instead of a physical card, we’re talking about virtual highlights. The ones you can find online for free are being turned into a limited number of “moments” for sale.

A Montrealer until his mid-20s, Schwarz displayed an entrepreneurial bent as a teenager, culminating in the creation of the Yo’Dough cookie company during his final year of university. He came up with unique flavours and sold them to stores.

“It was before the time of Uber Eats and that kind of thing, which would have been great for that business,” he says. It did get him cover treatment in the Montreal Gazette, which led to friends nicknaming him “Front Page.” Hence the title of his latest venture — Front Page Projects.

That background makes his cliff-dive into this space even more interesting.

“I think LeBron James is the greatest athlete of all-time across any sport…. And, from an investing standpoint, I really think he’s underrated. The way I see value with something like Top Shot, with the prices changing so fast, it’s really about comparing across the different ‘moments.’ Zion Williamson (New Orleans Pelicans), Luka Doncic (Dallas Mavericks), Ja Morant (Memphis Grizzlies), these guys are priced sometimes 60-80 per cent the price of a LeBron.

“They obviously have huge potential, but LeBron already is a legend. If he retired tomorrow, that card is going up. If Zion got hurt and had to stop playing tomorrow, that’s the end. And then he never even reached one per cent of LeBron’s career. So, it’s a value play. I thought it was undervalued … even though it was the highest purchase of all time. I think it’s already worth seven figures.”

Is it a fad without staying power? Is it safe and secure? The answers have major implications for the NHL, the NHLPA and the alumni.

In 2019, the NBA and its Players’ Association signed a multiyear licensing agreement with Vancouver-based Dapper Labs, creators of Top Shot. There are two ways to acquire moments. One is to buy them from someone else. The other is through a “drop” — an online reveal of new ones.

Caty Tedman, Top Shot’s head of marketing and partnerships, said Monday that total marketplace transactions are above $270 million since June 15, 2020. “Drop” sales go to the company, which also keeps five per cent of all user-to-user transactions. The NBA and NBPA get an undisclosed percentage on each.

This is an enormous shift from traditional memorabilia collection. Previously, royalties were paid on the initial sale. Once items went to the secondary market, it was out of a league’s or a players’ association’s control. Not anymore.

In the blockchain/cryptocurrency world, these moments are a class of digital assets known as “Non-Fungible Tokens” (NFT). Each NFT contains information unique to it, making it traceable and verifiable. In Top Shot, you can see the sales history of each moment. Code can be created that locks in the NHL, the players, the alumni, whoever, in every sale — not just the first one.

It’s massive, going well beyond collectibles.

“NFTs could turn into a top-three revenue source for the NBA over the next 10 years,” Dallas Mavericks owner Mark Cuban wrote to USA Today in an email.

As everyone recovers from the pandemic pounding, it’s impossible to ignore this stream. UFC announced a deal with the company last Friday. Tedman indicated work is being done on an extension with the NBA.

According to multiple sources, the NHL (with the NHLPA and Alumni) is one of several leagues discussing/exploring a marriage. Tedman, a New York Rangers’ fan and a manager in the NHL’s social media department from 2012–14, wouldn’t give anything away. But she smiled, pointing out that being Canadian-based might mean Dapper Labs is interested, too.

One source explained it as being similar to the Apple Store. Once a company establishes itself as the leader in its field, you want to be part of its family, not elsewhere.

You don’t need to find a spare $200,000 in your couch to get involved in this particular enterprise. Toronto-based hockey fan Justin Fisher made a $23 investment in a couple of “packs.”

“It went to $800, to $1,200, all the way to $2,800 before it came back down,” he said.

Fisher showed me how to look up his username on the site and check current value. It was at $1,673 on Sunday evening — in the top 28 percentile.

“I treat it like a stock portfolio,” Fisher says. “I’m going to wait and ride it out.”

(He told a great story about how he got a $3 Fred VanVleet moment for his mother, Wendy, a huge fan of the Raptor guard. She told him he’s not allowed to sell that one.)

Popularity is so high that it’s not uncommon to have 100,000 people online trying to snare a supply of 10,000. If you’re not high enough in line, good luck.

Dapper Labs’ initial foray into this space was called “CryptoKitties.” Users created and traded animated cats. One early rendition sold for $170,000. In May 2019, The Wall Street Journal reported on the fading of that fad, with the median price at $12.30. Tedman believes that sports are different, thanks to the enormous passion of its fans.

“We learned that people are interested in this,” Tedman said. “They wanted to engage in cryptocurrency in a way that wasn’t just currency speculation. We also learned it had to be credit-card-payment based. People were not interested in putting a digital wallet on their chrome extension, then worrying about password recovery. Eighty per cent of our payments are through credit cards.”

That answers one huge question about Top Shot. In researching everything from demand to security to the blockchain technology behind it, there’s a lot of, “I have no (expletive) idea what this is, but you can’t ignore it.” I asked Schwarz and Fisher if they were worried about losing their investments/profits if Top Shot lost its league licences, went bankrupt, etc.

“(The site) is rough — they point out they’re in ‘beta’ (tech speak for still in testing),” Fisher said. “But their partnership with the NBA, the company making five per cent on trades…. I just think this blew up too quickly on them. Once they catch up with demand, I think there’s more of a chance they do something special than burn out.”

“I don’t think the NBA would put their name on anything they weren’t planning on sticking with long term,” Schwarz said. “And, if another company took over, that means the world of digital collectibles becomes so big that someone else does it, and these would still be the original ones. That’s how I see it.”

“Once you own it, you own it,” Tedman said. “We can’t go into your wallet and take it away from you. That was very important to the NBA.”

(Schwarz also likes that Dapper Labs created the blockchain for this, called “Flow.” “It’s not all different projects on the same chain. This one is their own.”)

What also stands out is NBA players and owners pushing it, with force. Miami’s Andre Iguodala, an early investor in Zoom, jumped on this train last August.

“We’ve had player-management groups reaching out to us,” Tedman said. “Players sliding into our DMs.”

“Some people might complain that I can get the same video on the internet anywhere any time and watch it,” Cuban wrote in January. “Well, guess what, I can get the same picture on any traditional, physical card on the internet and print it out, and that doesn’t change the value of the card.

“That’s not to say the digital goods and CryptoAssets markets are perfect — they are not. Transaction costs can be high. The markets can still be moved by a few big players (whales), and … can be influenced by narratives that may or may not be true. But the bottom line is that there are a growing number of investors and traders who think that the digital goods and CryptoAsset marketplaces are better than old-school physical markets and the stock market, and most of them are young.”

Another who weighed in? Ted Leonsis (owner of the NHL Capitals/NBA Wizards):

“I thought about sports cards the last two years,” Schwarz said. “But to (buy a card), have it shipped, have it graded, where to store it — I don’t want to hold a $200,000 card in my room. I know a lot of people who do invest in traditional cards and they have them locked up somewhere. They’ve never seen their collection. They know on paper what they’ve invested and they know the value they’ve invested. They buy and sell and never even touch anything. This is the same concept, but you don’t have to do any of that.”

This is very different, indeed.


1. Another area where blockchain technology could have a massive effect on the NHL? Tickets. Some teams have moved into the secondary re-sell market, but many are sold out of their control online or hand to hand outside of arenas. Moving paperless into the “token” world allows for clubs/leagues to get a percentage of every sale, no matter where it occurs. In a gate-driven league, that’s a godsend.

2. A few years ago, I spent some time asking GMs about the intricacies of firing coaches. How do you know when is the right time? A consistent response was, “When you see no pushback. The momentum changes in a game, and your group consistently wilts in the face of it.”

Publicly and privately, Columbus GM Jarmo Kekalainen stands up for John Tortorella. This is key, because sometimes what people say in private is not the same as what they say in public. But, as the Blue Jackets were swept last weekend in Nashville, extending the losing streak to five games, it was impossible not to wonder about that “pushback.” Instead, Kekalainen publicly backed his coach on Tuesday morning, disputing the idea players have tuned out Tortorella.

“We owe him a lot for what he’s done for this franchise…. I don't believe in quick fixes — that you all of a sudden blow up something that you've been building for a while. I have full confidence we’re going to snap out of this.”

3. Kekalainen did confirm what has been rumoured, that the Blue Jackets are looking at centres. They’ve got some talented young players who need time to grow into that position, but immediate help is needed, too.

4. It’s a buyer’s market out there. With five weeks until the trade deadline, how many teams are really willing to take on money? Never mind “can” take on money under the cap, but would be willing to do so? The list is not long, and there are many more sellers than buyers.

Boston and Philadelphia are eyeing defencemen, although both teams must monitor expansion-draft issues. You don’t want to make that situation worse, unless of course you are trading something that nullifies the problem. Toronto is checking out forwards. Colorado is looking at some options, but I don’t know how high-salaried they would be. One interesting possibility: Minnesota. Unafraid GM and challenging for top spot in the West.

5. A perfect example would be what’s been happening with Anaheim and Vancouver. They’ve been grinding away off-and-on about a Danton Heinen-Jake Virtanen move for approximately a week. But it was never a one-for-one because the money doesn’t match. Heinen makes approximately $1 million more than Virtanen this season; the current Canuck will make $3.4 million cash next season. (Heinen is restricted with arbitration rights.) So they’ve been trying to figure how to equal things. For example, I could see the Ducks asking Vancouver if they’d be interested in Abbotsford’s Derek Grant. It’s a high-wire act.

6. On Jack Eichel: I know it’s white-hot in Buffalo, but I would be shocked for the above reasons if the Sabres considered a trade now. First, it’s something they have to come to grips with. Second, there simply aren’t a ton of teams in position to do it for budget or cap reasons. Things change in the off-season: contracts coming off the cap; the 10 per cent summer cushion; etc. The Rangers are an obvious exception — they could do it at any time, if they wished — although some of the proposals I’ve seen out there are kinda crazy.

7. I do think teams searching for goalie depth have asked Buffalo about Jonas Johansson, who will be an unrestricted free agent without 21 appearances of at least 30 minutes. Sunday was his second game of the season.

8. Alex Stalock is going to play in Edmonton. The crazy Anton Forsberg-Troy Grosenick Canadian quarantine waiver carousel means the Oilers are preparing to put three goalies on their roster and not risk any further claims. Stalock confirmed to The Athletic’s Michael Russo what had been rumoured, that he’d developed a heart inflammation due to COVID complications. There were fears he’d never play again, so it’s terrific that he’s back. (Was also great to see Rasmus Ristolainen and Ilya Samsonov last weekend for similar reasons.)

I do think the Oilers would like to see Stalock push Mikko Koskinen and Mike Smith; the challenge will be getting him up to speed following the quarantine. He has not played a game since Aug. 7, and it’s not like they can send him to AHL Bakersfield for a conditioning stint. Stalock is a competitive guy, so you know he’ll grind for the opportunity.

9. A week ago, the message to the Flames was, “We’ve got to solve our problems ourselves.” GM Brad Treliving is not afraid to look around, but there hasn’t been anything that made sense. Following Monday’s 5–1 defeat in Ottawa, Milan Lucic was spitting fire in defence of head coach Geoff Ward on the Sportsnet 960 post-game radio show with Pat Steinberg.

“You hear a lot of outside noise talking about coaching, style of play and all this bullshit,” he said. “But that has nothing to do with the coaches. That has everything to do with the guys that are playing…. We just want it easy on a night-to-night basis. We don’t want to work hard like we did when this coaching staff took over last year.”

The simple solution in these situations is to fire the coach — but Ward was given the full-time job on Sept. 14. That’s less than six months ago, and it would be such a rough look.

10. No team spent more in the off-season than the Montreal Canadiens, at $102.5 million — and that’s in American dollars, too. (Vegas was second at $100 million; Ottawa third in the mid-60s.) There aren’t many owners doing that during the pandemic, which ratchets up the pressure to extreme levels.

When Claude Julien was fired last week, Montreal was the best team in the league statistically at five-on-five, scoring 63 per cent of the goals in that situation during their games (Tampa Bay was right behind them). That’s usually a good sign for post-season success, but the heightened level of expectation meant GM Marc Bergevin felt he couldn’t wait that long to find out.

What that said to me is Bergevin feels the heat, too, which is notable. At last spring’s GM meetings (which seem like 100 years ago), Bergevin was facing intense criticism about his choices and made the rounds to several media to explain. He was confident, though. He had a plan and believed in what he was going to do; early this season it certainly looked like the organization was reaping rewards. This was not where Montreal thought it would be at the beginning of March.

11. I wondered if one of the Canadiens’ immediate goals would be to kick-start Phillip Danault, goalless in his first 18 games. New coach Dominique Ducharme tried just that, putting him on the first line and giving the centre a season-high 21:02 in last Thursday’s 6–3 loss in Winnipeg. But Danault didn’t play well, and was down to 15:32 two night later.

Earlier this year, La Presse’s Mathias Brunet reported Danault turned down a six-year, $30-million offer (word is the two sides were approximately $750,000/year apart). I’ve been in situations where my contract situation was uncertain — it screws with your mind. Danault is a really good player, and it sure looks like it’s affected him.

12. Carey Price is starting Tuesday against Ottawa. I wondered if the Canadiens would give Jake Allen a run, simply to let Price have more practice time. When Julien was fired, Price was 48th among 59 qualified goalies in Goals Saved Above Expected, an advanced analytic that takes into account the quality of the shot faced (courtesy Sportlogiq, Marc-Andre Fleury led the league). Opponents were targeting high-blocker on him, too.

13. Forgot to include this last week, but Los Angeles GM Rob Blake did say the Kings hope to re-sign UFA-to-be Alex Iafallo.

14. My guess on Andrei Svechnikov is his next contract comes in around Mathew Barzal’s (three years, $7-million AAV).

15. Welcome to the Hart Trophy race, Patrick Kane.

16. Thank you to Sportsnet’s Joshua Lessard for the research: No team has ever shut out an opponent three straight times with three different goalies. Toronto’s Jack Campbell and Michael Hutchinson shut out Edmonton on Saturday and Monday. Hutchinson started the second of those games because Campbell — just back from injury — was banged up again, joining Frederik Andersen in the infirmary. (Joseph Woll backed up on Monday.)

Twice, however, one team has shut out another three different times during a season with three different goalies. The first was Montreal over Philadelphia in 1968-69 (Gump Worsley, Tony Esposito, Rogie Vachon); the second was Washington over Montreal in 2010-11 and 2011-12 (Braden Holtby, Michal Neuvirth, Tomas Vokoun). Jordan Binnington and Jake Allen combined for three in a row with the Blues in 2018-19.

17. Toronto’s backups were 7-12-2 last season. This year, they are 6-1. Hutchinson is wearing a Wayne Thomas retro mask during games and a Felix Potvin during practices. Does he have more? It would be really something if he pulled out a Mike Palmateer and/or a Curtis Joseph and rotated them whenever he plays.

“There are no plans for any more right now,” Hutchinson said with a bit of a laugh.

David Leroux painted the Thomas mask for him, and they went to the original artist, Greg Harrison, for permission.

“I really like old-school masks,” Hutchinson said. “Clean and clear. So simple, but looks very cool. I love the history of the Maple Leafs.”

Any particular reason for Potvin?

“I was a huge fan growing up.”

18. Another KHL player to keep an eye on: Magnitogorsk defenceman Grigori Dronov. Just turned 23 and may need some AHL time, but there are NHL clubs watching him.

19. After seeing this, I understand why Winnipeg wants Nikolaj Ehlers to shoot more:

What a player he’s turning out to be. I thought he showed a lot in the bubble (even though the Jets lost) because he competed so hard when Patrik Laine and Mark Scheifele went down. Then, after close friend Laine was traded, he admitted, "This is tough — this is not much fun,” but hasn’t let it affect his play. Life stinks sometimes — how do you power through it?

The reaction of his teammates after he fought Corey Perry was priceless. He doesn’t drop the gloves often, but his last four are Perry, Brad Marchand, Ryan Getzlaf and Colton Sissons. Not exactly picking pushovers.

20. Wrote last week about the draft and the CBA-related headaches with moving it. Had a couple of people reach out to say what the piece lacked was a “what’s best for the game” angle. That’s a very fair critique, because it should be paramount.

Players, agents and teams feel very strongly that the right thing is to move it. They won’t give up their fight, even though the odds are against them.

21. Fun podcast interview with San Jose’s Mario Ferraro, who is at the nexus of where the NHL is going: a talented young player and an active social media presence. His YouTube page is very good, and you can find him at Youngest of Plugs.

You won’t see much recent activity — he wisely cuts down during the season as he concentrates on building his career. Ferraro did give a smart answer about his dream video: something with the Stanley Cup. He spent a week last summer with Joe Thornton, and saw first-hand how a 41-year-old remains driven in the pursuit of greatness.

“Every morning we went to the gym to train, he called it a tweak session,” Ferraro said. “You gotta work. He says it every day, ‘You gotta work. You want to play in this league for 10-plus seasons, you gotta work.’ (One day) I said I’m going to do an extra rep here because I screwed up on the first set. Next thing you know I’ve got Jumbo Joe Thornton coming over and doing an extra set with me. He doesn’t like to be topped. He won’t let you get an extra rep in.”

Another day, he did some extra sprints on a treadmill, causing Thornton to get annoyed because the future Hall of Famer had to leave and didn’t want Ferraro staying in the gym longer than he did.

22. What was the funniest thing you saw Thornton do?

“I don’t know why, but he loves to cut grass. And the whole week I was there, he was talking about cutting his lawn.”

23. Ferraro’s growth spurt came later, so he wasn’t a high OHL pick (the Barrie Colts took him). In an important lesson for all young players, he said he “understood everybody has a different path. I tried not to let the size thing bother me — it was all about compete.”

He went to the USHL’s Des Moines Buccaneers and went to the 2017 NHL Draft, expecting to wait awhile before being selected. He was surprised to go 49th overall, and even more shocked that it was the Sharks.

“My meeting did not seem… I think it went the worst out of all the teams,” he laughs. “It was in my head, I was thinking, ‘Wow, that wasn’t a good meeting…. San Jose’s not taking me, I’m done, no chance.’”

He went to NCAA UMass with current teammate John Leonard and Colorado’s Cale Makar, where his game grew.

“The first year I came into San Jose, they said one of the most important things I needed to work on is having a good stick and defending the rush skating forward…. There’s a lot of talent out there, so stopping the rush before they get into the blue line is crucial. So I worked on defending skating forwards and trying to skate lateral to maintain gap, rather than just north/south all the time.”

He’s got a bright future.

24. Finally, we asked Ferraro about his most regular partner, Brent Burns. There’s a common request from the veteran: “‘You get that puck to me. You get it to me. You get that puck over….’ (Burns) just wants the puck on his stuck. I’m throwing passes, and whether they’re flat or three feet in the air, it’s ‘I love that — just get it to me.’”

25. Beating even longer odds than Ferraro is Tanner Jeannot of Estevan, Sask. It appears as if he will make his NHL debut for Nashville on Tuesday night. He spent four years with WHL Moose Jaw before going undrafted. Signed by the Predators as a free agent in April 2018, he’s played 100 games in the AHL and eight more in the ECHL over the past two-plus seasons. A big winger, who — at 23 — didn’t have it easy. Great story.

26. Good news for WHL players based in British Columbia, as the provincial government announced Monday a plan is in place to allow the resumption of play in that province. The entire league is now in position to play, joining the already-in-motion QMJHL. That leaves the OHL as the only one with an unclear path, although it’s a poorly kept secret that the goal is something along 24 games in April and May.

Two weeks ago, Owen Sound defenceman Andrew Perrott, playing in Slovakia while awaiting a resumption in Ontario, authored a widely supported petition that was delivered to both the league and the provincial government.

“I was on the phone with a teammate of mine, Mark Woolley, who is also over here in Slovakia,” Perrott said. “We were chatting about how guys are struggling. I started writing down my thoughts and feelings on paper. Didn’t really think anything would come of it. Actually showed my mom and a couple of people I respect, and they (said), ‘Wow, you actually wrote that very well. You should maybe do something with it.’ The whole point was to raise awareness of how important the season is to the players. Guys have been struggling not being able to play and watching other (leagues) play right now. We just wanted to be heard.”

Perrott admitted he was nervous about pushing “send,” but San Jose’s Kurtis Gabriel — a close friend — encouraged him to go through with it.

“A lot of the players have thanked me for it…. They are struggling and it is hard on them.”

27. He certainly amplified their voices. OHL Commissioner David Branch released a statement, indicating “the Ontario Hockey League is anxious to return to play and eager to get our players back on the ice,” and “we continue to work hard toward ensuring a safe return to play for everyone.”

It’s a delicate dance for Branch, who recognizes that governments work at their own pace (slow) and antagonizing them is a bad idea. When Jeff Marek reported the WHL had an agreement with the province of Saskatchewan, the WHL was unhappy because the government didn’t want it released that quickly. So I see what Branch is doing here.

Perrott admitted another of his motivations was to help teammate Carter Robertson, undrafted and in his final year of junior eligibility. He pointed to another member of the Attack, Brady Lyle (Providence), and the Ottawa 67’s Noel Hoefenmayer (Toronto), who signed AHL deals following their overage seasons.

“How many guys (will) just quit hockey? How many guys’ careers are just over?”

28. Sam Gagner and John Tavares formally announced their “takeover” of the Greater Toronto Hockey League’s Marlboros, the crown jewel of the city’s minor hockey organizations. Both played there on their path to the pros, and Gagner was approached about this last spring. He loved his Marlies days, was immediately interested and brought in his close friend, Tavares. They remain in contact with their old coach, James Naylor, who will be heavily involved as the two continue their NHL careers.

“I can’t think of a practice that was systems-based or anything.... (It was all about) the development of us as players and as people,” Gagner said. “If we had a 50-minute practice, it was 50 minutes of trying to make us better hockey players. (With) different age groups, practices are going to be similar and going to be about skill development.”

29. One of the questions asked to Gagner was about whether he and Tavares are truly ready for what they are getting into. Since the story was first reported, Marek and I have been overwhelmed with stories about the issues facing minor hockey in Canada’s biggest city and the hope Gagner/Tavares can help change that.

“I like to think that we can help change that perception,” Gagner replied. “(We want to) create opportunities for everybody. My experience growing up: I had a rink in my backyard, I got to play in every tournament I could think of. I feel so fortunate to have had that upbringing and we want to look at ways to give every kid a chance to do that. I know that minor hockey has become big business and we don’t want it to be that way…. You had told some stories about parents paying for ice time. That’s not something we want. There’s a lot of minor-hockey players out there that have big dreams that their parents might not be able to afford. We want to give those kids the same opportunities that everyone else gets. So we’re going to look into ways to do that.”

One of the routes Gagner’s thinking about is “the academy model. I look at my upbringing, going to school in Oakville, playing hockey in Toronto. That’s a lot of time in the car. It took away from my education at times…. (Are) there ways that we can facilitate that for the next generation of players? We’re looking into those avenues.”

30. Gagner had some great lines. On player recruitment: “I’m going to make Connor McDavid do that for us.” (He’s another ex-Marlboro.)

On the Marlies’ elite level of success, he laughed: “No pressure on us coming in.”

On who wins any philosophical debate between him and Tavares: “I do. I’m sorry, John, but I’m older.”

31. Congratulations to Jeff Deline, leaving his position as Chief Revenue Officer at Maple Leaf Sports and Entertainment for the New York Mets. He put in the work. His wife’s name is Kim, and their wedding featured the greatest dance contest I’ve ever seen, by far. (I did not win.)

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