Pokemon Card Investment Thesis

Forrest

21 Oct 2025 — 19 min read

Many don't know this, but Pokemon is the world's largest IP.

Below is our investment thesis for Pokemon cards, a market we have become quite bullish on. Keep in mind, trading cards trade quite differently than liquid markets like stocks and crypto. Trading cards are generally less liquid and move with a lower turnover rate than more liquid markets.

The time horizon for our Pokemon investment thesis spans multiple years.

Before we jump into it, understand that as silly as Pokemon card investing may sound to many, the Pokemon card index has outperformed the S&P500 when anchored from almost any year. More intentional strategies have given even stronger returns.

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Investment Thesis

An investment thesis for high-grade, vintage Pokémon trading cards (1999-2002) is supported by a confluence of demographic shifts, sustained intellectual property dominance, demonstrable supply scarcity, and the development of professional market infrastructure. The original player demographic is entering its peak earning years, creating a wealth effect that intersects with powerful nostalgia-driven demand[1][2]. This is occurring as the supply of top-condition cards remains permanently fixed and verifiably scarce[3]. Concurrently, the asset class is maturing through the proliferation of institutional-grade vaulting services and the rapid growth of on-chain tokenization platforms, which are introducing unprecedented liquidity and new gamified demand vectors[4][5].

The Demographic Windfall: A Generation Aging into Affluence

The primary demographic of original Pokémon fans, who were children during the brand's 1996 launch and subsequent explosion, are now in their late 20s and early 30s, entering the 35-44 age bracket, which represents the highest-earning period for most individuals[1]. This cohort is transitioning from a position of nostalgic desire to one of financial capacity, creating a powerful demand-side catalyst.

Earning Power of the Target Demographic

Peak Earning Years: In the U.S., the highest median usual weekly earnings are found among workers aged 35 to 54[7]. For the 35-to-44 age group, the median weekly earnings were $1,351 as of the second quarter of 2025[7][8].
Specific Earnings Data (Q2 2025):
- Men aged 35 to 44 had median weekly earnings of $1,502[7][8].
- Women aged 35 to 44 had median weekly earnings of $1,190[7][8].
Disposable Income: In 2023, the mean disposable income for a U.S. household led by a person aged 35 to 44 was $109,075[9].
International Context: The financial situation for this demographic varies globally. In Japan, millennials own only about 10% of the country's financial assets and tend to be more frugal due to stagnant wages[10][11]. Their disposable income for non-regular employees is estimated at ¥221,000 (men) and ¥202,000 (women)[10]. In Europe, spending habits for millennials show significant allocation to shopping, travel, and pets, with Austria (14.92%), France (12.71%), and Spain (12.29%) seeing high percentages of expenditure on shopping[12].

Unrivaled IP Strength and Global Expansion

Pokémon is the highest-grossing media franchise in history, demonstrating unparalleled longevity and continued cultural relevance nearly three decades after its inception[1]. This sustained strength minimizes the risk of the asset class being a passing fad and provides a stable foundation for long-term value appreciation.

Franchise Revenue and Performance

All-Time Revenue: As of 2025, the Pokémon franchise has generated an estimated $150 billion in lifetime revenue, placing it first among all media franchises[13][14].
Revenue Breakdown: Key revenue streams include licensed merchandise ($113.7 billion), video games ($30.7 billion), and the card game ($26 billion)[14].
Recent Financials: The Pokémon Company generated a record-breaking $1.9 billion in revenue for the fiscal year ending February 29, 2024, a 15% increase from the previous year[15]. Licensed merchandise alone accounted for $10.8 billion in revenue in 2023[16].

Strategic Market Penetration

The Pokémon Company is actively expanding into previously untapped markets, particularly China and India, under a "Think Globally, Act Locally" strategy[17].

China: The first official Pokémon TCG release in China occurred in 2022[18]. The company has partnered with local giants NetEase and Tencent, and the first official game release, New Pokemon Snap, occurred in 2021[19][20]. A collaboration with the YouTube channel "Sean's Kitchen" has garnered over 400 million views[17]. China's TCG market is projected to grow at an 8.1% CAGR through 2031[21].
India: Viewed as a "huge and promising market," The Pokémon Company has established a dedicated marketing team and partnered with the Mumbai Indians, one of India's top cricket teams, to increase brand exposure[17]. The mobile game Pokémon Unite counts India as its second-largest market by downloads, with 13.29% of the global total[22].

The Economics of Scarcity: Verifiably Rare High-Grade Cards

The investment value of vintage Pokémon cards is fundamentally anchored in the verifiable and permanent scarcity of cards in high-grade condition. Decades of childhood handling, combined with manufacturing imperfections, have resulted in an extremely small surviving population of Gem Mint (PSA 10) and Mint (PSA 9) examples of iconic cards from the 1999 1st Edition Base Set[1][23].

PSA Population Reports for Key 1st Edition Holos

The Professional Sports Authenticator (PSA) population report provides a census of graded cards, illustrating the extreme difficulty in obtaining a perfect grade.

Card	PSA 9 Population	PSA 10 Population	Key Scarcity Driver
Charizard (#4)	729[24]	124[3][24]	Iconic status and centerpiece of the hobby.
Blastoise (#2)	716[26]	102[26][27]	One of the original three final starter evolutions.
Venusaur (#15)	716[28]	143[28]	One of the original three final starter evolutions.
Chansey (#3)	464[29]	48[29][27]	Manufacturing issues cause significant scratching on the holographic portion, making it exceptionally hard to grade[23][30].

This data demonstrates that scarcity is not limited to a single card but is a characteristic of the high-grade segment of the entire set. With the supply of unopened 1st Edition booster boxes dwindling, the population of these top-tier cards is unlikely to increase significantly[31].

The Nostalgia Premium: Quantifying Sentimental Value

The demand for vintage Pokémon cards is heavily influenced by a "nostalgia bid"—an emotional premium that buyers are willing to pay to own a tangible piece of their childhood[1]. Survey data confirms that this motivation is a significant driver for the target millennial demographic.

Primary Motivations: In a survey of 213 collectors, the majority of whom were aged 25-44, "memories and nostalgia" was the second-most-cited reason for collecting (47 mentions), behind only hedonic enjoyment (111 mentions)[2]. Financial value was mentioned only 14 times[2].
Generational Divide: A study on collectibles interest found a stark difference in motivations between generations. Among younger investors (Gen Z and Millennials), 39% cited "sentimental value" as a significant consideration in their investment decisions, compared to only 6% of older investors[32].
Purchasing Behavior: Millennials are highly influenced by social media, with 75% stating their purchase decisions are impacted by a brand's social media presence[33]. This aligns with the high visibility of Pokémon card "box breaks" and collection showcases on platforms like YouTube and TikTok[1].

Digital Transformation: On-Chain Liquidity and Gamification

A paradigm shift is underway as Pokémon cards are tokenized as Real-World Assets (RWAs) on various blockchains, primarily Solana and Polygon[34]. This process involves vaulting a physical card, minting a corresponding Non-Fungible Token (NFT) that represents ownership, and enabling fractionalization and 24/7 trading[35]. This innovation is unlocking significant new liquidity and introducing novel demand drivers.

Market Size and Growth

Trading Volume: The tokenized Pokémon card market surged to $124.5 million in trading volume in August 2025, a 5.5-fold increase since the beginning of the year[5][36][37]. This volume surpassed that of tokenized stocks on Solana during the same period ($74.6 million)[38][39].
Leading Platforms (August 2025):
- Courtyard.io (Polygon): $78.4 million in volume[5][40].
- Collector Crypt (Solana): $44 million in volume[5][40].
Platform Growth: The native token for Collector Crypt, CARDS, saw its price increase tenfold in the week after its launch, reaching a fully diluted valuation (FDV) of $450 million[41][5].

Gacha Mechanics as a Revenue Driver

A key innovation on these platforms is the "Gacha" or digital pack-opening mechanic, which gamifies the acquisition of cards and has become a primary driver of revenue and user engagement[42].

Mechanism: Users purchase randomized digital packs, recreating the thrill of opening physical booster packs[37]. Platforms often include an "instant buyback" feature, offering to repurchase unwanted cards for 85-90% of their market value, providing immediate liquidity and creating a soft price floor[43].
Revenue Generation: Collector Crypt's Gacha machine generated $16.6 million in revenue in a single week in late 2025[41]. The platform has seen over $89.5 million in total spending on its Gacha feature since its inception[43]. The platform projects $38 million in annualized revenue, largely driven by this feature[5].

Proliferation of Professional Infrastructure

The maturation of the Pokémon card market is evidenced by the development of professional, third-party infrastructure for storage, trading, and investment, which lowers barriers to entry for serious capital[1].

Vaulting Services

A competitive market of secure vaulting services has emerged, allowing collectors to store high-value assets and trade ownership digitally without physically shipping the cards. Leading providers include:

PSA Vault: The official vault for eBay, offering a fully integrated grading-to-selling experience[4].
Fanatics Collect: Formerly the PWCC vault, this service benefits from strong security protocols and integration with the Fanatics ecosystem, which includes Topps[4]. At one point, the PWCC vault held cards worth $750 million[44].
Alt: An independent option known for strong customer service and integrated data tools[4].
COMC: A long-standing vault service specializing in high-volume and lower-value cards[4].

Investment Platforms and Funds

While traditional Pokémon-focused ETFs or large-scale hedge funds do not yet exist, a new class of platforms is filling the gap, allowing for professional management and fractional ownership[5].

Splint Invest: This platform allows users to buy shares in pre-vetted investment funds that include Pokémon cards, offering diversification and professional management[45][45]. One such offering included two 1st Edition German Charizard cards[45].
Konvi: Offers fractional ownership of high-end collectibles, including Pokémon cards, curated by market experts and vetted for authenticity and appreciation potential[46].
Fractional Marketplaces: Companies like Rally, Collectable, and the now-defunct Dibbs pioneered the securitization of collectibles, allowing investors to buy shares in high-value assets[47][35].

Historical Market Performance

The trading card market has exhibited characteristics of a classic boom-and-bust cycle, with a massive run-up in 2020-2021 followed by a significant correction. The market has since stabilized at levels substantially higher than the pre-boom period, indicating a new, higher price floor.

Broader Market Trends (Card Ladder CL50 Index)

The Card Ladder CL50 Index, which tracks 50 iconic trading cards including a 1st Edition Charizard, serves as a market benchmark[48].

The Boom (2020-2021): After rising just 5% in the nine months leading up to March 2020, the CL50 index increased 160% between April and September 2020[48]. From an October 2020 low, the index surged nearly 200% to its peak in March 2021[48]. Cumulatively, the index soared 337% between 2019 and its March 2021 peak[49][50].
The Correction (2022-2023): The index fell 22.5% in 2022 and another 8.6% in 2023[49]. Other sources place the declines at 23% in 2022 and 9% in 2023[50].
Stabilization (2024): The index showed signs of recovery, with a 6.15% year-to-date increase as of late February 2024[51].

"Blue-Chip" Pokémon Card Performance (PSA 9 1st Edition Holos)

An analysis of the "big three" starter Pokémon from the 1st Edition Base Set illustrates these market dynamics.

Card	Pre-Boom Price (2019)	Peak-Boom Price (2021)	Post-Correction Price (2025)
Charizard (#4)	~$2,000-$5,000 (est.)	$30,000[1]	$25,000[1]
Blastoise (#2)	$800 - $1,100[52]	~$800 - $1,000 (for Dark Blastoise proxy)[53]	$5,356 - $8,800[54]
Venusaur (#15)	$700 - $800[52]	$595 - $4,305[55]	$3,083 - $5,371[56]

Even after the market-wide correction, the prices for these key vintage cards in 2025 remain substantially elevated compared to their 2019 levels, suggesting a fundamental repricing of the asset class.

Citations