CS:GO Cases - A Comprehensive Analysis of Recent Price Action
Topic: CS:GO Case Investing - Drop Pool, New Case, Price Increases
CSGO, short for Counter-Strike: Global Offensive, is a popular online multiplayer first-person shooter game. In this game, players can receive a variety of weapon cases in the Prime Drop Pool from leveling up throughout the week. These cases, once they leave the Prime Drop Pool, have a depreciating supply over the long term from players opening them.
In simple economic terms, the lower the supply, the higher the price. Cases can be traded or sold for real money, and as a result, many players have become increasingly interested in investing in these cases, hoping to make a profit in the long run. Nothing written in this article should be used as Financial Advice but rather just an analysis from my perspective of the recent case price boom seen since the start of the new year.
Prime Drop Pool VS. Rare Drop Pool
Players leveling up in-game can receive one of five cases from the Prime Drop Pool. The five cases currently in the Prime Drop Pool include the Revolution Case, the Recoil Case, the Dreams & Nightmares Case, the Snakebite Case, and the Fracture Case. As new cases are released, some cases eventually move from the Prime Drop Pool to the Rare Drop Pool, which we just saw happen with the Clutch Case when the Revolution Case was released.
Players have an approximate 1% chance for each case drop they receive to be a case from the Rare Drop Pool. Cases in this category tend to have depreciating supplies since more cases are being opened each year than earned as drops in this pool. While the Clutch Case initially saw a HUMONGOUS spike in price, it eventually retraced most of the Rare Drop Pool pump BUT is now showing signs of going back up!
The Good Old Days
If you played CS:GO before 2020, you may recall the good old days when a majority of cases were always the lowest price that the Stream Community Market allowed items to be, which was $0.03. Everyone, myself included, saw cases as worthless item drops whose sole purpose was to be opened for the chance to get a shiny new knife. Time has proven us wrong, though, because many failed to realize how simple economic concepts of supply and demand would be applied to these mass-dropped items, whose supply is "destroyed" when opened.
So what is a humongous underlying factor that has changed since pre-2020 to today that could cause such noticeable long-term price action? Simple answer: The player base. With an ever-growing player base, the natural demand for cases has been increasing, with newcomers testing their luck on CS:GO case openings. The demand for every other type of item is also increasing with the record amount of players, which is why we have been seeing an increase in the value of knives across the board.
EsportFire’s Case Indexes
Using EsportFires’s Case Indexes, it is easy to see that the price of the "Cases Pre 2016 Index", the "Cases 2016-2019", and the "Cases 2020-2022" have all been on a tremendous run since the beginning of the new year. However, it may not be the best time to buy if you are looking to start investing in cases. It could be very dangerous to start buying now because the charts have gone parabolic (up only) since January 8th.
What is Driving this Case Boom in the Short Term?
Many factors are coming into play regarding the current case price boom. As touched upon, the player base of CS:GO is at record levels, meaning that the natural demand for items is also at an all-time high. Another fundamental catalysis of this run was that, before the Revolution Case was released, we haven't seen a case release for 224 days (new record), which led to the increasing player base annihilating the supply of older cases over the long wait for a new case.
There has also been an ever-increasing case of FOMO, the Fear of Missing Out, spreading like wildfire (pun intended) throughout the CS:GO Trading Community. Many traders are starting to stockpile case investments in fear of missing out on the up trend, further starving the supply and increasing the demand for cases.
Being a part of the CS:GO trading scene since 2016, I have seen firsthand the impact that traditional markets and the crypto markets have on the price action of the CS economy. Typically, new capital flows into the CS:GO economy when the crypto market goes up. With that being said, I want to point toward the fact that Bitcoin, since January 8th, is currently up 50.8%.
When I looked at the EsportFire Case Indexes, I found it EXTREMELY interesting that the beginning of the current case boom began EXACTLY on January 8th, just like the current crypto boom. It seems to me that some traders are rotating parts of their newfound crypto gains into the historically safe long-term investment of CS:GO cases. And/Or, we could also be seeing the result of the community spending their newfound crypto gains to engage in the super fun and smart (just kidding) activity of just opening cases!
We are seeing the result of the perfect storm of events all lining up simultaneously to cause this dramatic increase in case prices.
Crypto Gains + Case Supply Starvation + Gambling Addictions = PAMP!
While it is impossible to prove, is it too far-fetched to speculate that some community members would rotate their crypto gains into case investments or opening cases? Especially with the proven long-term success of case investments such as the Glove Case or the proven long-term fun of funneling your hard earn money to Valve through case openings?
While a moment of profit-taking has to come, which may line up with the release of a new operation or (please GabeN) Source 2, perhaps CS:GO cases will continue their long-term growth over the coming years. However, please keep in mind that many risks come with investing in items that have already increased so much in value over the past few months. It will be interesting to see what the supply of cases will be in the future. We’d love to hear your thoughts about the recent case boom on our Twitter! Have a great day!
Editors note: Our community has shown a big interest in the CS:GO skin economy and market analysis. We're working together with an expert in that sector who, from time to time, publishes well-researched pieces like that one. By no means anything stated should be taken as an investment advice! Be careful where and how much you invest at any point and in every sector!