Founded back in 2021 by ColeThereum and Mr. Tubby, in what was a perfectly timed venture into the world of PFP NFTs, Pudgy Penguins has seen its’ fair share of ups and downs in its short 2 odd years of existence. What began with an aim to “create a positive and collaborative community,” saw the cutesy project face controversy, with a key member of the Pudgy Penguins NFT community alleging that the founding team emptied the treasury and tried to sell them a stake in the project for 4,000 ETH.
Fast forward to April 2022, and Luca Netz acquired the company for a cool $2.5 million, with every intention of breathing new life into what was a flailing (yet promising) company. The project gained popularity during the 2022 Christmas season and received a $9 million seed funding round led by 1kx, reinforcing its status as an intellectual property brand.
And now, we find ourselves in September 2023 and the media is all but blowing up about their expansion from the world of digital assets into the physical world, namely through the eponymous toys that Pudgy Penguins have launched on Amazon.
For someone who has been in the Web3/NFT/Blockchain space for a hot minute, this attempt at “being the brand that leads the way in onboarding people from Web2 into Web3,” as stated in article by Coin Desk, begs the question - is the way to lead Web2 people into Web3 REALLY going to be achieved through toys on Amazon?!
Reasons to be Skeptical
Every new technology entering the market typically follows a five-phase
“I think all Web3 companies would warmly welcome and embrace new people to the space, and not only the more tech-savvy and curious,” says Yang Lan, Co-Founder of Fiat24. But, in order to achieve that, we must focus on bridging the existing infrastructure, rather than segregating it further. Because of the nature of blockchain, Web3 platforms are scattered, with users often forced to create new wallets to access various Web3 apps. Until we address these issues, we will find it difficult to become mainstream.”
While the fascinating twist to Netz’s approach is a revolutionary IP Rights agreement with NFT holders, which places significant opportunities for them to monetize their penguin through merchandising and utilizing the visual asset in a variety of ways, I cannot help but wonder if the intersection between consumerism and the decentralized nature of NFTs is beneficial.
A Help or a Hindrance to Growth?
Decentralization is a cornerstone of NFTs, with decentralized marketplaces enabling people to buy, sell, and trade directly, without dealing with traditional chains of command and trading that may not always be evident.
Personally, I feel that crossing the boundary from using a technology that has the power to decentralize many of the world’s leading forces to align with one of the world’s leading consumerist retail giants (Amazon), kind of cheapens what is so unique and attractive about NFTs.
At best, the sudden buzz surrounding Pudgy Penguin merchandise will bring in a trickle of new users into the NFT space, and at worst, we will begin to see a misconception of what non-fungible tokens are all about. They are about anonymity, ownership, a passion for collecting, an entry into a community, a sense of pride - not a cheap toy to be bought on a notoriously unethical e-commerce site.