Pudgy Penguins’ parent company is shutting down Abstract, its Ethereum-linked layer-2 blockchain, after spending tens of millions of dollars on the project. Abstract will stop operating on December 15, and users have been asked to move their assets before that date.
The company said the decision came after slow growth, low trading activity, limited institutional interest and a small decentralized finance market. The shutdown makes Abstract the second Ethereum-linked layer-2 network to announce its closure in less than a week.
https://t.co/0F6yDmUPe5
— Abstract (@AbstractChain) October 6, 2026
Abstract was launched in January 2025. It was designed to make it easier for ordinary people to use crypto applications. The idea was to use the popularity of Pudgy Penguins to bring more users into the crypto world.
Pudgy Penguins started as a collection of cartoon penguin NFTs. Over time, it became a bigger brand with toys, games and other products. Its products are sold by major retailers such as Walmart and Target.
Abstract is winding down.
Starting today, all of @IglooInc’s focus will go towards taking Pudgy Penguins, Pudgy NFTs, and $PENGU to the next level.
When we acquired Frame in the summer of 2024, the vision was to build the blockchain for consumer crypto. Pudgy Penguins had shown us what it meant to reach the masses, and we believed we could bring that same approach to building a chain.
Abstract achieved a lot in a short period of time; we built the Portal and AGW, onboarded major global brands, amassed over 300 million transactions, and grew a vibrant onchain ecosystem.
The journey became stifled by the lack of a DeFi ecosystem, insufficient liquidity, minimal institutional cross-over, and prohibitively high costs that impeded growth in winning areas.
Unknown to most, Igloo, Inc. had been funding Abstract over the last 18 months.
After losing tens of millions of dollars over two years, building consumer products, assembling an all-star team, onboarding some of the biggest brands in the world, and building a community of millions, we still had not found product-market fit.
In combination with the market’s reduced appetite for what we had built and not being able to find a scalable path forward, we could no longer justify taking from the Pudgy Penguins business.
Igloo, Inc. has always been a community-first company. Even after losing 8 figures, we could have launched a token or pursued an ICO.
Ultimately we decided against this. A token only works if there is something driving demand to it, and launching a token that we don’t have conviction in would have been a disservice to our community.
The entire team at Abstract has worked tirelessly with a tremendous amount of passion to make the consumer crypto vision come true. I cannot fault a single one of them for this outcome.
To the Abstract community, I want to thank all of you for sticking by our side on this long journey and for continuing to champion us. You supported us through all of the ups and downs, and I wish the result could have been different.
There will be many that will find satisfaction in seeing this shut down, and that is fine. I take a great amount of pride in having the ambition to venture into the chain business, notoriously one of the most difficult to make work, and the only regret I have is not being able to celebrate a win alongside the Abstract community.
As we wind down Abstract, our full focus shifts to making Pudgy Penguins into the global & cultural phenomenon I know it can become.
Return to Pudgy Penguins.
— Luca Netz 🐧 (@LucaNetz) October 6, 2026
Igloo, the company behind Pudgy Penguins, funded Abstract for about 18 months. However, CEO Luca Netz said the company did not want to keep putting money into the blockchain at the cost of its main Pudgy Penguins business. The company also decided not to launch a token or conduct an initial coin offering to raise more money.
Abstract says it processed more than 325 million transactions and had about four million wallets. It also reported around $6 billion in decentralized exchange trading. Businesses using the network generated more than $40 million in revenue, with companies such as Disney and Red Bull Racing taking part.
But high activity on applications does not always mean the blockchain itself makes enough money. Data from DefiLlama showed that Abstract generated only about $3,900 in network fees over the latest 24-hour period. Applications running on the blockchain generated about $39,000 in revenue during the same period.
The company had earlier encouraged developers to build fun and consumer-focused applications rather than financial products. However, the network struggled to attract enough activity and liquidity.
Abstract’s shutdown comes only days after another Ethereum layer-2 network, Blast, also announced that it would close. Blast said its operating costs were higher than its revenue.
Abstract still had about $76 million in assets on the network, according to DefiLlama data. Users will have until December 15 to move their assets through the available migration service or bridge.
Stay informed with the latest trends in Web3, blockchain innovation, and cybersecurity updates at 3verseTV
You need to login in order to Like
Leave a comment