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SAN FRANCISCO — This past week, a trading card featuring the quarterback Tom Brady sold for a record $1.3 million. The total value of the cryptocurrency Bitcoin hit $1 trillion. And Christie’s sold a digital artwork by an artist known as Beeple for $69.3 million after bids started at just $100.
These seemingly singular events were all connected, part of a series of manias that have gripped the financial world. For months, professional and everyday investors have pushed up the prices of stocks and real estate. Now the frenzy has spilled over into the riskiest — and in some cases, wackiest — assets, including digital ephemera and media, cryptocurrencies, collectibles like trading cards and even sneakers.
The surges have been driven by a unique set of conditions. Even as millions were laid off in the pandemic, many people’s bank accounts flourished, flush from stimulus checks and government cash infusions into the economy. But while people accumulated more money, traditional investments like stocks and bonds became less attractive.
So many got creative and, bored in the pandemic, took on more risk. Often, they were egged on by online communities on Reddit and Discord, where the next big investments were hotly debated. They also turned to tech tools like the trading app Robinhood and the cryptocurrency platform Coinbase, which allowed them to buy and trade different items with the click of a button.
That has now led to mini-bubbles across a wide variety of esoteric categories, making once-obscure acronyms like SPACs and NFTs practically as ubiquitous as the S&P. It has also fed ferocious demand for this week’s public listings of companies like the gaming site Roblox and the South Korean e-commerce company Coupang, as well as for shares of the video game retailer GameStop and other so-called “meme” stocks.
“It’s just a pent-up cycle where the money has nowhere to go, so it’s doing stupid things,” said Howard Lindzon, an investor, entrepreneur and market commentator.
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