Monarch Has A Ceiling (For Now). What Does It Mean?

Alright, so ChannelFireball put up their Monarch pre-orders this week at $250 a box for first edition and a little over MAP for unlimited. Quickly, I’ll say that I really don’t like the optics of a store with a direct relationship with LSS pumping boxes at nearly three times MSRP, but I’m also not surprised, and there’s nothing any of us can do about it. If they wanted to look like good guys, they could have sold the individual boxes at $250 and sold the bundles of one unlimited box each of MON/ARC/WTR and one first edition MON at $380, which is all four boxes at MSRP. With a limit of one bundle per address, this would have likely been very well received. They’d be offering first edition at MSRP but via a method that’s not easily abused, and they’d have plenty left over for $250 cash outs at over five times what they’re probably paying wholesale.

Anyway, that all sucks, but we might as well move on. We’re going to avoid further discussions of whether this is good for the game, bad for the game, etc. and just focus on pure market implications of the decision and associated hot takes by yours truly. Let’s try to unpack what this means for Monarch buy/sell decisions and pre-orders, and how the sealed box market might respond to the eventual release.

Price Ceiling

The biggest immediate implication of the CFB announcement is that this move has imposed a price ceiling on pre-orders. While they had previously gone up to $300-350 from some sites, there’s no real incentive for anyone to pay over $250 for as long as CFB’s supply holds out or until they raise prices. So, in some ways, this should act as a stabilizing force for the market. While their price isn’t particularly exciting, it is lowering the market price. Also, they’ve held down prices for sustained periods of time before (for both WTR and ARC back at the end of 2020, and of CRU in recent weeks), so I could totally see them holding out for a couple months at least.

While CFB lists stock, the amount of product that they’ve listed for FAB has never been the actual amount they have, so I treat that number as essentially meaningless for gauging if they’ve actually sold through or as an indication of how much they actually have. Given their past practices with FAB, I think it is highly likely that they will be withholding a portion of their supply of first edition from the market (total off the cuff guess, I’d say 20-30%). If this is the case, I assume they have a plan for how and when to release the remainder to the market – likely based on particular price points or amounts of time post release. For example, maybe when boxes hit $500, they will put out half of their hoarded stock. The main takeaway here is that we should all assume CFB probably has meaningfully more first edition Monarch than they will be selling through pre-order. So even if they, at some point, are “sold out”, I would bet you a pile of estrikes that you’ll see them putting boxes on ebay throughout Q3 and Q4 of 2021.

As an aside, I think the CFB ceiling creates an awkward situation for their competitors. Miniatures Market, for instance, took their prices all the way up to $350 a box, so if they drop to $250 now, I feel like they either have to refund the difference to people who bought at $350 or prepare for a wave of cancellations (as I was revising this piece, they had already dropped to $325, though I’m unsure if they issued partial refunds to the $350 preorders). This situation is probably even trickier for any small retailers who took pre-orders at $300+ and don’t do refunds because they’re going to see serious chargebacks. In the abstract, people knew what they agreed to when they ordered, but this would hardly be the first time that people have realized they messed up and attempted to dig their way out of it through dubious means.

Seriously, I love this box design, and you can’t stop me from using it whenever applicable

Should you buy some?

As always, it depends. We’ll do the simple scenario first. If you want to buy first edition MON to put in a closet for a year plus, I think your only question is, “will the game be healthy a year from now?” If so, then $250 is probably going to return decent value. If you want to open a box, I would avoid $250 first edition boxes unless you really like rolling dice.  Simply put, the expected value (EV) of a box of MON is likely going to be less than $250, and even if it is $250, any individual box will be incredibly swingy, so you’d want to be sure you were opening a few cases to get something approaching average EV.

To expound on that, If we assume that most of the value in a set of first edition FAB is concentrated in the CFs and the RF Majestic cards, your average box is going to have a CF C and two RF Ms (especially if MON, as a big set, is back to doing CFs at Common, Legendary, and Fable but not Majestic). Current WTR/ARC CF Cs sell for $120-220 while CRU ones sell from $65-125, and even CRU CF Cs are likely to be significantly scarcer than MON ones will be. Even at an inflated premium, they should settle down to $30-75, though I’m sure we’ll see some go for well over $100 early on. However, given that I can still regularly buy sub-$100 CRU CF C’s right now, I have a hard time believing that MON CF C’s can top those prices for a sustained period of time while it’s the current set. Similarly, the best RF Majestics from CRU are at $100 or less and the worst ones are a lot closer to $10-20. This means that opening $250 or more in value from a box of MON likely means that you need to open an L, which is going to take 80 packs on average assuming LSS didn’t futz with the 1:480 ratio they’ve maintained to date for each unique L in a set. In short, opening just a couple boxes is probably going to yield less value than just buying the same cards as singles unless you get lucky.

Also, definitely don’t buy the ChannelFireball bundle, it’s a pretty much just a small discount on unlimited Monarch, but you also have to take ARC and WTR as well, which isn’t great for most people. If you’ve already got cards, you likely would be better rounding out your WTR/ARC stuff with singles. If you don’t have cards, spreading yourself out across single boxes of three sets means you could be getting a smattering of cards for 8-12+ classes. If Monarch ends up being all new classes, then you’re going to be spread very thin. Given that I don’t think a single first edition box at $250 is a thing that’s likely to be good for you, you could just order a case of MON unlimited from anyone selling for MAP at a little over $300. Then you can take that $150 you saved and buy ARC/WTR generic singles to fill out whatever class you decide to go in on. For almost any situation, there’s a better way to use your FAB money. Remember, once unlimited ARC/WTR is readily available, finding $65 boxes likely won’t be that hard (*cough* Gamenerdz *cough*).

If you do want $250 boxes as an investment, and you want them locked down now, I think CFB is likely your best choice. As ever, I know they’re not exactly beloved by the FAB community, but I do have a lot of confidence that if they sell you a box, they will actually have the stock to ship it to you come launch day. The same cannot be said of many online sellers who oversold before having their allocation numbers.

Let’s Get Crazy

OK, now that my due diligence is done for the major points, let’s get into the wacky part where I spitball some weird scenarios we could end up in. First, let’s work from the assumption that CFB manages to maintain stock at $250 until close to release date. This doesn’t seem entirely implausible as their sales haven’t exactly been lightning fast so far (assuming the stock count isn’t being pushed back up –which, if anything, would be the opposite of the way you want to misrepresent data as a vendor). In that world, and especially if they’re still selling $250 boxes at and post-release, I think we’re going to see a lot of $200 boxes show up as people who got in at $76 decide to just take their profits. A lot of people are likely over leveraged on MON and will need to cash out some or the majority of their position when the set actually drops. To do that, they’re going to need to sell at the lower end of market price, which will in turn drive the market price down. With CFB offering boxes at a $250 ceiling, that means that $200 or less boxes could show up as these people start to move. There could even potentially be a bit of a cascade effect if a lot of people were setting up to sell as soon as they got their early boxes. We could even see prices race down closer to $150 as people panic in an attempt to lock in that magical double up.

Now, over time, I expect sealed Monarch to rebound and push past $250. If prices get low enough, more financially stable people will come in and buy those boxes. For instance, if boxes every got down to $150 or less post-release, I will probably expand my position, and, given that I’m an overly cautious investor, you can bet that there are people out there ready to pull the trigger sooner than me, scooping up boxes at $175 or $200. This would also play interestingly with the singles market. Either singles prices would prop up box prices because they could be broke and sold for singles, or falling box prices would pull singles prices down with them. It’s very hard to tell how this would play out because we’ve never had a set where the supply was gone immediately AND demand for singles was high. CRU sold though right away for the most part, but singles remained cheap for several months. As I’ve said before, I expect MON to debut with very high singles prices that stores will scale back on only after trying their luck at higher points. However, if CFB is still trying to sell $250 boxes come May, I think that seriously impacts the dreams of $750-1k Legendary cards that singles sellers are likely salivating at. With readily available $250 boxes, you’d be better off just buying a case.

Now we have another scenario where things go very differently. If CFB sells though, or, more realistically, decides to pull their product and wait for higher prices, than the ceiling comes off. In that scenario, I could very much see the market treating it as a major panic event and rushing out to get boxes at ever-increasing prices to the point where we were pushing past the $350 high water mark. In short, I’m going to be keeping my eye on CFB as the canary in the coal mine, but with the knowledge that the canary is shady and has a history of manipulating the market (alright, that’s a grossly mixed metaphor, but I also like the image of a little canary up to nefarious capitalist deeds, so I’m keeping it in.)

*Header – Kano Dracai of Aether by Alexander Mokhov

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