New Phyrexia Stock Exchange: Chaff to Cash – Interview with Cardsphere’s Ted Rodney

Welcome back to another look into the world of Magic Finance. In addition to collecting various types of Magic products, from singles to sealed product, I also play limited paper events and open quite a bit of sealed product for my YouTube channel. As a result, I tend to have more bulk cards on hand than I know what to do with including tons of $2 rares I’ll never be able to get rid of. In my first article, The Basics of Magic Finance, I made mention of how necessary it is to track your collection’s inventory and value. Cardsphere is an online trading platform which can help you do both. While I do use my own custom excel sheet to track my high-value inventory, I frequently use the platform to offload bulk rares that don’t even show up on buylists let alone have competitive offers. For this article I got into contact with one of Cardsphere’s founders, Ted Rodney, and asked some questions about their platform and received answers that I think everybody will be interested in:

 

The question any new business must ask itself before the “when” and the “how” is the “why” it is in business – what was the decision making like for deciding to create Cardsphere?

 

A few years ago, I was working at a software company in Ottawa, Canada with one of the other Cardsphere founders, Michael Baranov. We often played magic at lunch, me trying to keep up with his tight technical play and tier one decks with my ghetto-fab scrubbiness and janky budget abominations. I was already online trading via several platforms, and the relentless lunch time beatdowns motivated me to trade harder to acquire the cards needed to compete. Michael especially enjoyed negotiation-free online trading in particular, which was a compelling feature of one platform.

The timing here was perfect. Michael had some success in getting cards, and as a talented software developer, when that platform rolled out a major overhaul with severe problems, he felt it was time to act. He put out a call on Reddit to see if there were any other like-minded developers or testers, who wanted to create a better trading platform.

Turned out, there were.

Tom Reece down in Texas had developed a bot for the negotiation-free platform, and had also built an external marketplace for that site’s currency. Threats of legal action stopped that work, and Tom started working on a platform of his own which he planned to call Tradebindr. Michael and Tom got talking, other developers, testers, and traders joined the discussion, and we became a community. Cardsphere has always been about a strong community, even before there was a product anyone could use.

So ultimately, the decision to make Cardsphere was easy. We all just wanted a better system for doing what we love: trading magic cards. We wanted a platform that inspired consumer confidence with a data-rich but simple interface. We also wanted to be a company that was as transparent as possible, and operated ethically.

Deciding this is also easy; carrying it out is the hard part.

I speak to a lot of people about their ideas for Magic-related businesses or projects these days. My advice to people is get busy doing the work. It’s the best way for you to actually come to grips with how much work there is to actually do. And only once you really understand that can you decide to commit.

 

What does your site’s monthly activity level look like and what volume of value trades hands between players?

 

We put an immense amount of information out there for users, so they always have their finger on the pulse of the market activity. Our frontpage displays counts for number of users, and the number and value of items traded all time. We also display the number and value of items for the active, ongoing trades. Divide that up by the number of months in business to get the average monthly number. Currently we are sitting at just under $100k per month in trades.

We are seeing the effects of the Magic Summer Slump™ right now, but outside this, we have been seeing steady growth in trade activity since day one. We have a deep commitment to providing the community with stats, and released a massive amount of data in the Year One In Review article on our blog, Trading Posts. The chart below is a sample from that article, showing the amount in escrow (the value of cards being actively traded) growing over time.

 

Cardsphere also provides a market dashboard when you login, which gives you at-a-glance information about the last week’s activity. You see how many cards were traded, and at what percentage of the index price, broken down into several price buckets.

As of this writing, for example, 124 cards worth more than $50.00 USD were traded in the last week. The median offer percentage for these was 85% of the index price, with half of all offers being within the range of 75% to 90%.

You can also get specifics for each unique printing of a card. Let’s look at the Avacyn Restored non-foil Griselbrand.

You can see the current index price of the card, as well as the price of every other printing. Your current “Haves” and “Wants” are listed, and can be added to directly. The trade count for the last 30 and 360 days, as well as how many copies are held by the community.

Cardsphere provides detailed information about the last 10 completed trades on one tab. On the other, you can see the top ten current offers you can fulfill.

Has it been observed that there are certain “power users” of the site that tend to buy cards in significant amounts from others, or purchase far more than they sell?

 

Cardsphere’s a unique marketplace in that there are so many different types of users involved. We have people that sell exclusively, which is usually someone selling off a collection and looking to maximize value. They can get better than buylist on chase cards, and often extract extra value out of very low value cards they simply could not buylist at all while they’re at it. We have people that buy exclusively, topping up their account balances to get cards cheaper than retail. And, of course, we have people like me, who don’t deposit or withdraw funds at all.

I just use Cardsphere to trade cards for cards. I send out cards that I don’t want in order to earn the credit I can use to get the cards I do want sent to me. A prominent MTG finance guy once commented that using Cardsphere this way is the equivalent to a “cashless TCGPlayer.”

We see users of multiple platforms frequently engaged in arbitrage, buying and selling cards across markets as a passionate hobby, or in some cases, professionally. We also have multiple LGSes using Cardsphere to expand their customer base, or offer customers a buylist without having to invest in prohibitively expensive platforms like Crystal Commerce.

So far we seem to have developed a very well functioning ecosystem. And we do provide leaderboards in card count and card value on our frontpage.

   

How can somebody new to the realm of Magic Finance take advantage of your site’s features?

 

Well, my previous answers have already gone over how much information we provide to our community about the marketplace, so I won’t repeat myself. Instead, I’ll focus on how we insulate our community from the extreme variance we’ve begun to see in the prices of cards on the secondary market. For people who are new to Magic Finance, our protections can’t be beat.

First of all, we calculate our index prices based on information gathered about multiple external sources, which we do not reveal. This redundancy and secrecy helps prevent anyone from being able to game the system by causing price spikes.

Of course, there are always going to be legitimate price spikes, and that’s where we offer stronger consumer protection to the community. We do this by applying a maximum price you’ll pay automatically. We set this price ceiling at 110% the maximum price of your offer (I say maximum price because you can list a “Want” for multiple versions of a card, thus your offer can be a range).

You can also override the automatic limit manually. Or, if you’re prepared to risk any price changes, remove the limit entirely.

We also protect users from receiving cards they may no longer want at current prices when reprints are announced. We do this by having a community-activated kill switch, so if enough people click the “Report Issue” link for a card [it will be flagged].

Are there any tips you can give to users for getting the most from their sales?

 

One of our contributors has recently published an excellent article on this subject. In addition we also recommend:

  • Be patient.
  • Save on the cash-out fees and get cards for your balance.
  • Use anchors to build better packages
  • Do not hesitate to add funds if you feel the time is right to snatch some deals

How did Cardsphere build its initial economy and what is the plan to sustain it and prevent activity from becoming stagnant?

 

The best way of ensuring that Cardsphere remain vibrant and viable is to make sure it has a solid reason to exist. And it does. Cardsphere acts as a hyper-efficient peer-to-peer trading platform which helps both sides beat the reseller middle man and split that juicy margin in half between themselves. In other words Cardsphere market exists in the sweet spot between buy-list prices and retail prices as evidenced by the trade stats we provide. For as long as the game of Magic exists there will always be a need for people to trade cards.

Another important area of focus is confidence. That’s why we chose USD as the currency. No monopoly money with 100% of the money held in the reserve (bank). Money is flowing in and out of the market freely, as the market conditions require it. This ensures long-term stability.

– Ted

 

We hope you enjoyed this bit of insight into one of the newest and fastest growing Magic trading platforms out there right now. If you haven’t already, check out Cardsphere‘s site and start turning your bulk cards into cards you actually want. Feel free to leave your comments and questions down below. You can also reach out to me on my YouTube channel’s twitter account: @mtg_vc

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Mike VC

Mike VC

Mike started playing Magic around 2005 - starting with the Kamigawa block. His favorite format to play right now is Pauper which he regularly plays on MTGO. Mike is a Magic YouTube content producer who specializes in sealed product openings; you can find his content under MTG Vintage Crack. Find him on Twitter @mtg_vc.

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