SEOUL — IPX, the digital intellectual property company formerly known as Line Friends, is facing growing accusations of an NFT rug pull after its NFT partner, CRIPCO, abruptly shut down its primary community channel and ceased communication with investors.
The controversy intensified when a blockchain project that was reportedly set to absorb the NFT community publicly denied any affiliation with CRIPCO, prompting investors to question whether both companies had effectively abandoned the project and its holders.
From Line Friends to NFTs
In 2022, Line Friends rebranded as IPX and announced its expansion into the NFT sector through a partnership with CRIPCO, an NFT-focused platform. Under the agreement, CRIPCO became the central operator of IPX’s NFT initiatives, while IPX participated in the CRIPCO DAO, the governance body responsible for key project decisions.
Through the partnership, IPX launched several NFT collections tied to its popular character intellectual properties, including Wade and OOZ. The Wade collection attracted considerable attention after IPX announced a collaboration with Peaceminusone, the fashion label founded by K-pop star G-Dragon.
Communication Channels Disappear
According to local media outlet Bloomingbit, the companies unexpectedly shut down their official Discord server on May 29, removing what had been the primary communication platform for NFT holders. Since then, investors say neither IPX nor CRIPCO has provided meaningful updates regarding the future of the project.
Before closing the Discord channel, the project reportedly informed members that the community would be integrated into the ecosystem of blockchain infrastructure platform Creditcoin. However, Creditcoin developer Gluwa’s CEO, Oh Tae-rim, later rejected claims of any relationship with CRIPCO, creating further confusion among investors.
The conflicting statements have fueled allegations that the NFT project was abandoned without fulfilling its commitments.
Unfulfilled Promises
Investor frustration has been amplified by what many describe as a failure to deliver the benefits promoted during the NFT launch.
For its flagship Wadeside project, the team had promised rewards based on NFT holdings and holding duration, along with exclusive merchandise, offline events, and additional community perks. Investors claim many of these benefits never materialized despite extensive marketing efforts that highlighted the credibility of the Line Friends brand.
One investor told local media that they purchased the NFTs largely because of Line Friends’ reputation and the project’s promised rewards. The investor argued that shutting down communication channels and remaining silent after failing to deliver commitments amounted to deceptive conduct.
Another holder reported receiving only a single T-shirt and a storybook since purchasing the NFT, describing the rewards as insignificant compared to what had been advertised.
NFT Values Collapse
The market value of the collections has declined sharply since launch.
The floor price of Wadeside NFTs has fallen to approximately 0.0295 ETH, representing a decline of roughly 95% from its original auction price of 0.34 ETH, which was valued at around $1,090 at the time of sale.
Similarly, the OOZ collection has seen its floor price plunge from approximately 0.033 ETH in 2024 to just 0.0008 ETH, leaving the assets with little practical market value.
Questions Surround CRIPCO’s Structure
Adding to investor concerns are allegations regarding CRIPCO’s corporate structure.
Some market observers have questioned whether CRIPCO was created specifically to manage IPX’s NFT operations. Public records reportedly show that CRIPCO’s registered business address matches that of ATOZ Singapore Consulting, a company that assists businesses with establishing corporate entities in Singapore.
Critics have also noted that CRIPCO was incorporated only three months before entering into its partnership agreement with IPX, raising questions about the company’s operational history and long-term plans.
Anonymous posts on workplace community platform Blind have further alleged that Line Friends had already withdrawn from the NFT business and that CRIPCO functioned primarily as a paper company established in Singapore.
IPX Responds
In a statement provided to Bloomingbit, IPX rejected suggestions that it had abandoned the project.
The company said that, as the owner of the underlying character intellectual property, it remains committed to playing an active role and will continue working with relevant stakeholders to address concerns responsibly. IPX also stated that additional guidance for NFT holders would be provided at a later date.
At the same time, IPX emphasized that CRIPCO operates as an independent company responsible for conducting NFT-related business activities using IPX’s intellectual property.
As investor concerns continue to mount, attention is now focused on whether either company will provide a clear recovery plan or compensation strategy for affected NFT holders.
