Pudgy Penguins
The story behind today's most popular NFT collection
TLDR:
Pudgy Penguins were released in July 2021 by Cole Thereum and 3 of his friends, minting for just $60 per NFT, with 8888 penguins in the collection.
Cole and his team released Lil Pudgy’s and Pudgy Rods NFTs later in December, but were ousted by the community by early January 2022 for their poor decisions.
Luca Netz, a young entrepreneur with a background in selling toys, saw the potential of the Penguins as a toy brand and bought the IP outright for $2.5m.
Luca turned the brand around, working on multiple fronts non-stop throughout the bear market, willing the Penguins into the number 1 NFT spot.
Today, they have the highest NFT floor price of over $70k, they’ve just released the $Pengu coin at $3bn market-cap and are leading the charge as a Web3 brand.
We’re in crypto summer, there’s new coins and tokens balooning in price every day, and BTC keeps hitting new ATH’s - it’s a special time to be deeply immersed in crypto and Web3.
This week in particular a lot of attention has gathered around the Pudgy Penguin NFTs with the release of their new $PENGU token.
So today I decided to have a look back at their story. They’ve overcome a lot to become one of the top NFTs in the space, and there’s no better time to look back at their journey than now that they are in the limelight!
Read on to learn more, and if you want to continue the conversation then jump in here: beginners.tokenpage.xyz.
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Pudgy Penguins
The Pudgy Penguin NFTs were originally launched back on 22nd July 2021, where they sold out all 8888 penguins in under 20 minutes for 0.03 ETH each, around $60 back then, earning the team over $500,000 in mint fees.
At the time they were yet another collection launched in the NFT mania of 2021. The founding team were led by Cole Thereum together with 3 other founder friends, and the penguin art was created with the help of freelance artist Antoine Mingo.
The time between 2021-22 was the mania fuelled bull-market period of the past crypto-cycle, where new NFT collections were being minted daily and capturing hundreds of thousands or even millions of dollars at mint. As NFT collection prices just kept going up and up, there seemed to be no end to the euphoria.
The number one NFT collection of the time were the Bored Ape Yacht Club (BAYC) who seemed to consistenly dominate everyone’s attentions, with BAYCs being bought up by A-list celebrities like Eminem, Madonna, and Taylor Swift (although it was later discovered that many BAYCs were in fact gifted to these celebrities for marketing).
The Apes in particular reached an incredible floor price of around $450,000 (150 ETH) each in late April 2022. And Yuga Labs, the company behind the Apes, made huge amounts of money with other NFT mints like the Mutante Ape mint ($91m) and Otherside mint ($316m), and even through venture capital raises ($450m).
Top collections like the Apes commanded a huge amount of attention with their eye-watering valuations. Meanwhile, while the Penguins had a lot of love throughout 2021, but they only had brief peaks above a 3.5 ETH floor and spent most of the time closer to 2 ETH or below, with a lot less interest on them.
Lil Pudgys, Rogs and Rugs
Most NFT projects at this time had no clear playbook to follow, so they basically just copied each other. Some promised to use the mint funds to make games, while others suggested you were buying into the next big Disney-like brand. However, the only real way most projects made any money was to just release new sub collections of NFTs.
In those early days, Cole and the Pudgy team decided to do the same - probably due to a lack of ideas of what else they could do. And on 19th December 2021, they released a new collection called Lil Pudgys with 22,222 NFTs, with 8888 being gifted to original Pudgy Penguin holders and 13,334 minted through a dutch auction.
These Lil Pudgy’s were just as cute as the original and very well received, after all it was what all the projects were doing at the time. The Penguins in particular had a very strong community with a very solid core base of holders that loved the art.
Things quickly became sour though when the Lil Pudgy’s companion egg NFTs hatched on December 25th into very bland looking fishing rods named Pudgy Rods (often called “Rogs” in a derogatory way).
The art looked like an after thought and the general community sentiment quickly began to shift. Cole and his team had been promising a game, books, and a token but in practice holders got ugly fishing rods and a team that didn’t really seem to know what they were doing.
Things came to a head when a tweet thread came out from 9x9x9 on January 5th 2022 of an internal conversation he’d had with the team where Cole appeared to suggest they’d taken all the money from the two mints and were now looking to abandon the project and sell it. The community viewed it as a clear rug-pull.
So the community quickly rallied against the Pudgy team and voted them to be kicked out. All that remained was for a buyer to take the Penguins off the founders’ hands and there were a few interested bidders.
Luca Netz
Enter Luca Netz. At the time Luca was still a somewhat unknown figure in Web3, and took to the stage and began to rally people from within the community to support him on his buyout of the Pudgy Penguin IP from Cole and the founding team.
Luca ended up spending 750 ETH, or around $2.5 million, to buy out the Penguins as he saw huge potential. Many people were not convinced at the start, but he began doing regular calls in the community Discord explaining his vision, and slowly more and more people got bought behind him.
Luca himself was only 23 years old at the time, however he’d already had some success in business. At 18 he made his first million selling dummy gold chains online, and by 21 he’d already made a name for himself scaling the Gel Blasters toy brand massively as CMO of the company, putting them in Walmart shelves all around the US.
Luca believed he could replicate this success with the Pudgy Penguins IP. With a strong vision and great sales skills he was able to rally people alongside him. He kept community spirits alive and kept repeating that one day the Penguins would be the number 1 NFT collection in the space and introduce the masses to crypto and Web3.
He helped grow the positive sentiment in the community and their rallying cry “I am my penguin, my penguin is me” grew stronger and stronger.
Luca’s purchase of the Penguins finalised on April 4th 2022 and the excitement began to build back up within the community when they released a new roadmap later that month that mirrored the same type of visual roadmap that BAYCs had released.
Luca wasn’t without his controversy though. While many were excited by his past successes, many also pointed to his past failures. He’d allegedly sold rip-off merchandise and courses, ran a paid crypto discord “NetzTrades” where he promoted rug-pulls, and had videos of him boasting of shady marketing practices taken down.
So while many bought into Luca’s vision, there were also still many sceptics about what he’d be able to do with the Pudgy Penguins.
Crypto Winter
Crypto headed into its prolonged bear-market in 2022, first with the implosion of Terra-Luna in May, followed by Celcius Network and Three Arrows capital in June, and finally with FTX collapsing due to massive fraud in November.
As the market headed into a crypto-winter it dragged down all the NFT prices along with it. Collections like BAYCs fell from the eye-watering floor price of $450,000+ further and further down to “just” $27,000 per BAYC in June 2024.
People built up a lot of hate towards NFTs, and the term became almost a dirty word. Yuga and the Apes in particular were seen by most as a complete disaster, while other big collections like Azukis, Cool Cats, and even the Crypto Punks suffered massive valuation drops that have yet to recover to their peak (and most probably never will).
However, this is where Luca and the Penguins, instead of giving in, actually doubled down. Luca worked dilligently with his team to bring his original vision to life of making toys out of the Penguins and growing the brand.
He made it very clear that he had no intention to dilute the already diluted collection with further NFTs. Instead he believed value accrual of the NFTs would happen through getting Pudgys to become the de-facto brand that pushed Web3 to the masses, and he made a very important tweet thread about this in August 2023.
In essence Luca’s thread said that as the Pudgy brand grew over time and became more and more established through it’s many fronts, people would want to get hold of the original NFTs as collectors items, and the NFTs’ inherent scarcity would drive up their price.
Building in the Bear Market
For anyone who paid attention, the Penguins worked dilligently and did more than any single NFT project during the bear market. I’ve listed some of these examples below but I’ve not actually covered everything since they’ve done so much.
Firstly, Luca importantly managed to make good on his main promise of getting Pudgy plush toys released in several shops around the world and into people’s hands.
Hundreds of happy customers have created unboxing videos sharing their satisfaction with the new Penguin toys and the company is literally making millions in revenue havind sold over $10m worth of toys.
Next, Luca revamped the website and created an online experience called Pudgy World that’s still in pre-alpha but allows you to dress up your Pudgy and roam around different online mini games and experiences.
Where every owner of a Pudgy Penguin plush toy has their own virtual equivalent soulbound Pudgy NFT that they can dress up and customise.
The Penguins also did an industry first by allowing Lil Pudgys to move cross-chain with LayerZero (LZ) technology. Through LZ they created something they called a “SoulTransport” where essentially you can bridge Lil Pudgy’s from Ethereum main chain to any of the Polygon, Arbitrum or Binance Smart Chain networks.
Moreover, they also created a licensing platform for NFT holders to license their own Pudgys, giving holders not only IP rights, but a way to genuinely leverage those rights! In fact all of the plush toy Penguins have had their IP licensed by the Pudgy team, so those specific holders make a return on sales. Another industry first!
Not to mention that the Penguin team has created several incredible marketing videos for each of these different releases along the way. Generating excitement and attention from their constant new promotional content.
Moreover, they’ve grown their Instagram to over 1.7M followers and constantly churned out regular memes and gifs of the Pudgy Penguins.
The Penguins have already managed to reach way beyond the crypto and Web3 niche with their toys and gifs. It’s become very common for people outside of crypto to share them on social media without even knowing that they are a Web3-native brand!
Pengu & Abstract Chain
Through all this work the Pugdy Penguins have become a legitimate growing Web3 brand, and in the process their company Igloo even raised $11m from Peter Thiel’s Founders Fund.
While these numbers still pale in comparison to Yuga Labs, all of the Pudgy’s continuous success was enough for them to flip the BAYC floor price earlier this year and become the number 1 NFT collection (other than the CryptoPunks)! The latest floor prices show them at an approximate 19.3 ETH with BAYCs at 18.5 ETH.
Luca and the Penguin community literally willed into reality something he’s been saying for the past few years about the Penguins become the number 1 collection and him being “the face of NFTs”.
There’s no doubt they’ve become the de-facto biggest and most well known NFT collection, and as we’ve entered this new crypto-summer it really seems like they are just getting started and we can expect bigger and bigger things.
This week all eyes were on the Penguins as they released their very own token called $Pengu, to further cement their place as number 1. They intelligently airdropped it to not only Pudgy holders but to all sorts of long-term Web3 users in the Ethereum and Solana ecosystems.
And so far $Pengu’s total market cap is holding above $3bn, which is around 3x the market cap of BAYC’s $Ape coin that’s currently around $1bn. It’s a monumentous moment for the Penguins as their coin has already become on to be one of the most valuable cryptocurrencys in the space, 60th according to Coinmarketcap.
And if you think they’ve finished you’d be wrong, as they previously bought up the Frame blockchain and repurposed and renamed it to Abstract chain that’s going to be an L2 on Ethereum, which is looking to be released early next year.
All this is incredible to think about given that only a few years ago they were seen as a forgotten bargain bucket NFT collection who were abandoned by the founders, just like hundreds of the other collections released in 2021 that have since been forgotten.
And now they are reaping the benefits of all their hard work! The cheapest Pudgy NFTs of the Pudgy Rods currently cost over $3,000 (0.8 ETH), the Lil’s are over $7,000 (2 ETH) while the main Penguins are worth more than $70k (19 ETH).
Plus most of the Penguin holders have earned a bunch of $Pengu for their support with Lil’s earning a $5k+ airdrop and Penguins a $50k+ airdrop just this week!
Pudgy Penguins’ story is a real testament to Luca’s strong vision, execution, and the Pudgy community that never gave up and kept repeating their mantra “I am my Penguin, and my Penguin is me”.
Pudgy Penguins are on a high right now, $Pengu’s been released, and there’s still the likelihood that Abstract have their own governance token released in the next few months too. Let’s see if the Penguins can keep riding this momentum and continue to create the blueprint for what a successful NFT project can look like!
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