Pudgy Penguins Solana Token, Ethereum NFTs Plunge Alongside Abstract Network Launch

Pudgy Penguins NFTs and PENGU, the ecosystem’s Solana token, have fallen sharply in the last 24 hours since its parent company launched Abstract, a consumer-focused Ethereum layer-2 network.

PENGU has fallen 24% during that time and 49% in the last 30 days to $0.0173, dropping it outside the top 100 crypto assets by market cap according to CoinGecko. The Solana token has fallen to its lowest price since the volatile launch day in December.

Meanwhile, the original Pudgy Penguins NFTs on Ethereum have experienced a similar decline, dropping just under 20% in the last 24 hours, and 39% on the week to $37,950 or 11.94 ETH.

While the broader market decline may have played a role, some traders and analysts have suggested that the steeper Penguin decline comes amid the lack of immediate rewards for Penguin-linked assets on the Abstract network.

“The reaction suggests that [Pudgy Penguins NFTs] were being priced with the expectation of a mainnet [token generation event] with a healthy drop to Pudgy holders, not a prolonged XP/Points program,” posted on-chain analytics and block explorer platform Parsec Finance on X (formerly known as Twitter).

The price decline has also helped propel an NFT liquidation cascade on Blend, the Blur marketplace’s NFT financialization platform, as detailed by pseudonymous “Modern Market” podcast host and Web3 analyst, BCheque.

“Because the floor price keeps going down, more lenders pull their loans, which increases the number of NFTs needing to refinance the loan. When no lender steps in, the NFT gets liquidated into the hands of the lender,” he said. “The lender does not want it; [they] just wanted to earn interest on the loan. So the lender sells it to the market to recoup as much of the loan principal as possible. Repeat over and over again as the spiral continues.”

The decline marks more than a 60% retrace from the Pudgy Penguins high of more than $100,000 prior to its PENGU airdrop in December.

While the community stirs on the lack of immediate rewards for Pudgy Penguin users, the Abstract team made it clear that multipliers for XP—the chain’s native reward system—would not be the only way that Penguins and PENGU holders are rewarded.

“At launch, the Pudgy Penguin and Lil Pudgy status gives users bonus XP for using Abstract. There will be more coming for these holders,” the Pudgy Penguins X account posted. “PENGU plans to have a significant tie in with Abstract in the near future, but for now, enjoy extra XP every week based on your tier.”

For now, Pudgy Penguins and Lil Pudgy NFT holders can claim an XP multiplier inside their Abstract Global Wallet rewards tab. Owners of at least 88,888 PENGU tokens—approximately $1,520 worth at current prices—can do the same.

Abstract launched its mainnet and portal on Monday. The Pudgy Penguins parent company raised $11 million in 2024 in an effort to launch the network, attempting to get billions of users on-chain and interacting with consumer crypto applications and projects.

Edited by Andrew Hayward