Azuki NFT Founder came clean about abandoning 3 prior Non-Fungible Token (NFT) projects in the last year. The founder, Zagabond, posted a blog describing his prior 3 projects that he slow rugged while making upwards of $3million. After the news broke, numerous other seemingly credible allegations came out surrounding Zagabond.
Azuki are considered by many to be one of the more blue-chip NFT projects out there. They are a 10,000 avatar NFT collection that claims utility of “streetwear collabs, NFT drops, live events, and much more that will be revealed over time.
Additionally, being the owner of an Azuki allows access to “The Garden” a “is a corner of the internet where art, community, and culture fuse to create magic.”
Azuki’s were trading at a 20 ETH floor (over $40,000) when the news broke and traded down to a 10 ETH floor. The price has recovered from those low levels.
Azuki Founder Zagabond’s Rugging Past
Zagabond was a creator of 3 prior NFT projects that all slow rugged their audience. The reason for Zagabond fessing up to his past is unclear, but widely speculated that someone was going to leak the news. On May 9th, Zagabond posted an explanation on his past involvement with 3 projects abandoned shortly after the money was made…I mean after ‘launch’.
If you don’t want to read the mirror post, it contains a lot of buzzwords, tries to spin everything in a very positive light, and promises to ‘return the reins’ over to the community for each project.
The 3 prior NFT projects were:
- CryptoPhunks – When you mint a CryptoPhunk it choosed a random CryptoPunk and flips it to the left. If you recall there was issues around censorship and ownership between CrytpoPunk’s Owner Larva Labs, Open Seas, and the Phunks. (Read all about CryptoPhunks and the interesting questions around Web3 Censorship Here)
- Tendies – Meme NFTs that used a raffle based system. This was based on the Wall St. Bets Reddit forum meme of being able to afford chicken tenders. The project was abandoned after only 15% of the supply was minted. The NFTs also looked like what my dog leaves in the yard after eating a box of my kids cranyons.
- CryptoZunks – Another CryptoPunk ‘parody’ but this time with the ability to ‘re-roll’ different traits to change your character on-chain. These also came with a pet.
Abandoning projects after cashing out isn’t the only unscrupulous activities Zagabond is accused of. To try to build buzz around CryptoZunks, Zagabond allegedly made a female avatar and pretended to be a creator, ‘Amanada’.
Zagabond Claims High Gas & Lack of Market Fit Lead to Abandoned Projects
Zagabond claimed he had the best intentions in his manifesto. He credits the learnings of these 3 failed projects for the success of Azuki and pointed to the high ethereum gas prices and lack of a market fit for the projects failures. Zagabond says all the promised deliverables were actually delivered and so the projects weren’t rugs.
He also claims to have tried to make the communities whole. However, prominent members of each NFT community have come out and claimed that nearly immeditately after the mint the discord and twitters of the project were deleted.
Zagabond says he will turn the reins of the projects over to the community. However, this is becoming a common tactic post rug in the crypto community. “Turn the reins over” is essentially a euphemism for “abandoning the project formally (after making all the money) and letting the people who have been unofficially running it during the soft rug be the official people running it”.
Basically a nice sounding way of admitting to a soft-rug.
Allegedly, Zagabond had profited over $3million over the 3 abandoned NFT projects and none of that money was returned to the communiy.
The Future of Azuki NFT
Despite the news and a ~50% drop in the floor price of Azuki immediately following the disclosure, Azuki has seen a bounce back. Over $700 million worth of trades have been done in the NFT since the new broke.
It is unclear if the floor bouncing back to over 15ETH is a dead cat bounce as traders try to profit on the news or if the formerly blue-chip project proves resilient.
However, more controversy has come out since with the accusation that the Azuki team leaked metadata on a related project, Beanz. The accusation uses on chain data showing wallets that sold common Beanz and purchased rare Beanz after the mint but before the reveal.
The allegation of leaking metadata to allow for inner circle profiting, if true, would taint any of the supposed apology for the soft-rugs on the previous projects.
If Azuki survives and continues to be a blue chip is yet to be seen.