They are each their own blockchain tokens on the BTC blockchain via counterparty. Like separate altcoins but on the btc blockchain with transferability just like a coin, and enforced scarcity with a set total issued asset cap. They are on the btc blockchain and therefore are mined by BTC miners so there need be no inflation and are as secure as bitcoin and you can put them in cold storage just like btc etc..
Bitcoin 2.0 colored coins stuff that I'm not going to pretend that I know all that much about to be honest..

This is a neat secondary/other blockchain use case that has been built for a long time (counterparty) and this implementation (online meme trading card game) is putting it to good use, gaining popularity, showing the power of crypto..

They are not physical goods but mainly they are collectibles..

What you get is a BTC blockchain asset that I will send to your BTC address (of a wallet that is compatible with assets, or import priv key) that proves that you own this 1 of 250 rare pepe digital trading card and then you can do what you please with it just like any coin..

You can then keep it and play the game with them in the future, or sell it on the counterparty exchange https://wallet.counterwallet.io/#pages/exchange.html or the rare peep online wallet exchange https://rarepepewallet.com/ (2 exchanges), or HODL, or trade it p2p for other cards, or p2p for other coins or whatever you can imagine..

Sorry if I'm being too long winded..