Underdog Set to Launch Rips, Random Card Packs Built With Phygitals

Underdog has published terms for "Underdog Rips," a paid digital card pack that pays out a randomly selected physical trading card, without announcing the product. The document, version 1.1 with an effective date of Aug. 26, sits on the operator's public legal center beside its fantasy and sportsbook terms.

FairGambling opened the legal center on Aug. 27 and read the full text. Underdog's main X account posted more than a dozen times that day and did not mention Rips. Phygitals, the company named in the terms as its partner, promoted its own packs and said nothing about Underdog.

A Random Card and a Seven-Day Clock

The terms describe a pack whose contents are "determined by a random number generator (RNG) algorithm," with odds "disclosed to you prior to purchase" and prices "at various price points as displayed on the platform." Phygitals Inc., described as "an independent third party," sources, vaults and ships the physical cards. Rips "are not available in all states," and cards ship only to U.S. addresses.

The mechanic that separates Rips from a card shop is what happens after the pack opens. A user may hold a card in the app's "Collection" tab for "a maximum of seven (7) days." After that, the terms say, the card "will be deemed sold back to Underdog" and the user is credited its fair market value "as determined at the time you opened the applicable Underdog Rip." Underdog "will attempt" to send a push notification 24 hours before that happens.

Every pull therefore ends in one of two places: a shipped card, or cash credited to an Underdog account.

The terms ban reselling Rips or their cards on any outside marketplace, cap each company's liability at the price of the pack, and route requests for provable fairness records to Underdog's support desk, which can supply a server seed hash, client seed and algorithm for a given opening.

Buyers agree that they, not Underdog, are responsible for "understanding local laws regarding digital assets, collectibles, and any regulations that may apply to randomized reward mechanics."

The Sale Comes While Repacks Face Scrutiny

Underdog is the fantasy and pick'em operator that IG Group agreed on July 30 to buy for up to $1.3 billion. That deal is expected to close late this year or early next, subject to regulatory approval, and Rips does not appear in IG's acquisition materials.

The product would enter a market that already has a name for it. Lawyers at Womble Bond Dickinson wrote on Aug. 5 that "repacks" and box breaks face exposure under gambling, lottery and consumer-protection law, citing California's ban on sports card "grab bags" and a recently unsealed False Claims Act suit against Whatnot and Fanatics Live. Barron's reported on Aug. 26 that it counted 52 digital repack sites and that Birches Health, a gambling-addiction treatment provider, logged a 207% rise over 12 months in patients mentioning trading cards and digital repacks. The reporter, Nick DeVor, wrote the same evening that "Fanatics has an offering, and soon Underdog."

Underdog would not be first. Fanatics sells the format on Fanatics Live, and Phygitals opened a storefront on Fanatics Collect in April. GameStop launched Power Packs with PSA on April 15, at $25 to $2,500 a pack with instant sell-back. Rips by Triumph, an app whose referral codes flood X daily, sells packs from $1 to $1,000 and pays out through PayPal and Venmo.

Phygitals says in its own documentation that it "does not classify its pack openings as gambling, but regulatory treatment of randomized reward mechanics varies by jurisdiction." Its standard buyback is 85% of fair market value, paid in USDC.

Underdog's terms answer that question the way its fantasy terms do: state by state, at the company's discretion, "without notice." Neither Underdog nor Phygitals has said when, or where, the product goes live.

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