How It Works

Collective makes it easy to invest in Pokémon cards without the hassle of sourcing, storing, or selling them yourself. Here's how the platform works from start to finish.

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Overview: 3 Simple Steps

1️⃣ Deposit USDC

Connect your wallet and deposit USDC to receive vault tokens representing your share of the vault.

2️⃣ Vendors Trade

Expert vendors use pooled capital to buy and sell Pokémon cards for profit.

3️⃣ Earn Returns

As the vault grows, your tokens increase in value. Withdraw quarterly during liquidity windows.

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The Deposit Process

Step 1: Connect Your Wallet

• Use MetaMask, WalletConnect, or any Web3 wallet

• Make sure you're on HyperEVM network

• Need help? See Getting Started

Step 2: Choose a Vault

• Browse available vaults (each vendor has their own)

• Review vendor performance, strategy, and track record

• See current APY, total value locked (TVL), and depositor count

Step 3: Deposit USDC

• Approve USDC transfer to the vault contract

• Specify your deposit amount

• Receive vault tokens proportional to your share

What Are Vault Tokens?

Vault tokens are ERC-20 tokens that represent your ownership in the vault. As the vault grows through successful trades, your tokens become more valuable.

Example:

• Vault is worth $10,000 with 10,000 tokens outstanding

• You deposit $1,000 → You receive 1,000 tokens (10% of supply)

• Vault grows to $12,000 → Your 1,000 tokens are now worth $1,200

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How Vendors Trade

Once capital is deposited, vendors get to work:

Sourcing Cards

Vendors buy cards from:

• Estate sales and private collections

• Bulk lots and liquidations

• Online marketplaces (eBay, TCGPlayer, StockX)

• Local card shops and conventions

Grading & Authentication

Cards are authenticated and graded by professional services:

• PSA (Professional Sports Authenticator)

• CGC (Certified Guaranty Company)

• BGS (Beckett Grading Services)

Grading adds value and reduces risk of counterfeits.

Storage & Inventory Management

Cards are stored securely in climate-controlled environments. Vendors track inventory and performance.

Selling

Vendors sell cards when the market is favorable:

• Online auctions (eBay, PWCC)

• Marketplaces (TCGPlayer, StockX)

• Private sales to collectors

Profits are returned to the vault as USDC, increasing vault value.

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Vault Performance & Token Value

How Vault Value is Calculated

Vault Value = USDC Holdings + Card Inventory Value

• USDC Holdings: Liquid capital (liquidity buffer + recent sales)

• Card Inventory: Current market value of all cards held

How Token Value Increases

As vendors sell cards for profit, the vault value grows. Your share (vault tokens) becomes more valuable.

Token Value = Total Vault Value ÷ Total Tokens Outstanding

Performance Tracking

• Real-time vault value updates (weekly or on-chain)

• Historical performance data

• Transparent transaction logs (all on-chain)

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Withdrawals & Liquidity

Quarterly Epochs

Vaults operate in 3-month epochs (Q1, Q2, Q3, Q4). At the end of each epoch, a withdrawal window opens for 2 weeks.

How to Withdraw

1. Submit withdrawal request during the window

2. Specify how many tokens you want to redeem

3. Tokens are burned, USDC is sent to your wallet

Liquidity Buffer

Vaults maintain a 10-20% liquidity buffer in USDC to handle withdrawals smoothly without forcing card liquidations.

Example Timeline

• Jan 1 - Mar 31: Q1 Epoch (vault is active)

• Apr 1 - Apr 14: Withdrawal window (request withdrawals)

• Apr 15: Withdrawals processed

• Apr 16 - Jun 30: Q2 Epoch begins

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Fees & Costs

Performance Fee: 20% (High-Water Mark)

• Only charged on new profits above the vault's previous peak

• If the vault declines, no fee until it surpasses the old high

• Industry-standard model (used by hedge funds)

Example:

• Vault grows from $100k → $120k: 20% fee on $20k = $4k fee

• Vault declines to $110k: No fee

• Vault grows to $125k: 20% fee on $5k = $1k fee (only on the $5k above $120k)

Operating Costs

Deducted directly from the vault:

• Shipping & handling

• Grading fees (PSA, CGC)

• Storage

• Marketplace fees (eBay, TCGPlayer)

No annual management fee. You only pay when the vault profits.

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Risks to Understand

Investing in Collective comes with risks. We're upfront about them:

Market Risk

Pokémon card prices can be volatile. Not all cards appreciate. Market corrections happen.

Vendor Risk

Vendors may underperform or lose money. We vet carefully, but there's no guarantee of returns.

Smart Contract Risk

Code bugs or exploits could affect the vault. We conduct audits, but risk can't be eliminated.

Liquidity Risk

Withdrawals are limited to quarterly windows. Your capital is locked between epochs.

Regulatory Risk

Legal clarity is evolving. We geo-block US participants and will obtain licenses as we scale.

See Risks for a full breakdown and mitigation strategies.

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What Makes Collective Different?

vs. Buying Cards Yourself

• Us: No expertise or time required. Vendors handle everything.

• You: Need to source, authenticate, store, and sell yourself.

vs. Traditional Platforms (Otis, Rally)

• Us: On-chain transparency. 20% performance fee only (no annual fee).

• Them: Opaque. 1-2% annual fee + performance fees.

vs. DeFi Lending (Maple, Aave)

• Us: Real-world asset. Uncorrelated with crypto markets.

• Them: Crypto-native lending. Correlated with market cycles.

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Ready to Get Started?

👤 For Funders: Getting Started 🎴 Meet Our Vendors 💬 FAQ

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Questions? Reach out on Twitter or join our community.