The PENGU coin, which is a component of the Pudgy Penguins NFT ecosystem, has had a difficult start to its eagerly awaited introduction. The token’s value fell by more than 50% in the hours following its airdrop on December 17, leaving investors and the NFT community in shock. A summary of the incident and its effects may be found here.
A Good Beginning Goes Bad
At launch, the PENGU coin had a market value of about $2.8 billion. However, as the price of the token fell from $0.068 to $0.031, this amount rapidly fell below $2 billion. The steep drop brought to light the difficulties the coin, which is traded on the Solana blockchain, is facing. PENGU was created to go well with other NFT collections, such as Lil’ Pudgys and Pudgy Rods, as part of the Pudgy Penguins environment.
Sell-offs and Community Allocations
About half of the 89 billion PENGU tokens were given out to the public by the Pudgy Penguins team, with 26% going straight to NFT holders. Shortly after the airdrop, there were notable sell-offs in the market despite this substantial allocation. Early in the morning, more over 20% of the token’s total supply—roughly $9.3 million—was liquidated. The market’s volatility was further exacerbated by significant sales from wallets associated with early investors.
Market Unbalance and Trading Volumes
With a trading volume of $425 million shortly after its release, the PENGU token’s introduction sparked a lot of trading activity. But the disparity between buyers and sellers led to more instability. The price decline of the token was exacerbated by the fact that there were far more sellers than purchasers.
A Hit to NFT Floor Prices
The value of Pudgy Penguins NFTs was also impacted by the market volatility for the PENGU coin. A Pudgy Penguin NFT’s floor price dropped precipitously to about 16 ETH from 36 ETH prior to the token launch. The downward pressure on prices was exacerbated by the offloading of assets by numerous investors who had bought NFTs in order to be eligible for the airdrop. With millions of branded toys sold through big-box stores like Walmart, the Pudgy Penguins initiative is still a leader in the NFT market despite this setback.
Launch is marred by technical issues.
Technical problems with the PENGU token launch added to the pandemonium. While some users encountered issues accessing the claim page, others reported missing tokens. One of the top providers of cryptocurrency wallets, MetaMask, identified the website as possibly dangerous. Users trying to claim their tokens experienced delays as a result of the website’s high traffic volume. In order to allay these worries, the Pudgy Penguins team promised users that the claim period will stay open for 88 days.
Fears Regarding the Future
Although there was immediate euphoria surrounding the PENGU token’s introduction, its early performance has prompted concerns about its long-term prospects. The initiative has a lot of obstacles ahead of it, especially given the dropping floor costs of Pudgy Penguins NFTs. With a devoted following and a wide range of products, the Pudgy Penguins brand is still well-known in the NFT industry.
The difficult launch of the PENGU coin serves as a reminder of the unpredictability of cryptocurrency markets. Investors and NFT aficionados will be keenly monitoring the Pudgy Penguins team’s efforts to overcome these obstacles in order to determine whether the project will bounce back and gather momentum.
