Original author: c 4 lvin, Four Pillars

Original translation: Saoirse, Foresight News

Editor's Note : As a prime example of the Web 3 sector's transition from speculative investment to physical commerce, this article systematically presents the complete evolution of the NFT project, Fat Penguin, from its founder succession crisis to the construction of a global IP ecosystem. The article provides an in-depth analysis of the strategic restructuring path following the Luca Netz acquisition, covering key development milestones such as breakthroughs in the commercialization of physical toys, the establishment of the PENGU token economy, and the exploration of compliance in traditional financial markets. Through a composite model analysis of "NFT asset ownership confirmation + brand IP operations + blockchain technology infrastructure," the article reveals an innovative paradigm for the commercialization of digital assets.

The following is a compilation of the original text, with appropriate deletions and adjustments made.

Core Summary

• After experiencing the crisis of founder removal in 2022, Pudgy Penguins underwent a major transformation under the acquisition of Luca Netz, gaining brand influence through social media strategies and cooperation, and successfully expanding its physical toy business.
• Fat Penguin subsequently issued the PENGU token, becoming the world's fourth largest cryptocurrency by market capitalization and the largest memecoin issued in the past three years; it expanded into comprehensive entertainment IP through the release of games and children's content such as "Pengu Clash" and "Pudgy Party", and cooperated with Asian companies such as Lotte and LINE FRIENDS to accelerate globalization.
• Fat Penguin became the first NFT project to enter the traditional financial market. It applied for an NFT and token hybrid ETF through Canary Capital and plans to launch an IPO in the near future. It continues to prove that NFT can create actual commercial value as an IP asset, rather than a simple speculative tool, and is committed to achieving large-scale application of Web 3.

Fat Penguin NFT: Origins and Early Development

Project launch and the "Big Snow" crisis

Source: The New York Times

In July 2021, the NFT series "Fat Penguin" created by four college students including Cole Villemain was officially launched. 8,888 uniquely generated Fat Penguin NFTs were sold out within 19 minutes at a price of 0.03 ETH each, attracting celebrity purchases and gaining attention from mainstream media such as the New York Times.

In December 2021, Fat Penguin launched the Lil Pudgys series consisting of 22,222 "little penguins". After distributing one for free to each Fat Penguin NFT holder, the remaining 13,334 were successfully sold, further expanding the community size.

However, hidden dangers gradually emerged beneath the project's initial prosperity. The original team had promised a video game, an NFT educational book, and a "mystery egg" to hatch on Christmas Day 2021, but most of these plans went unfulfilled. The resulting "fishing rod NFT" was mistakenly labeled "Rogs" (it should have been "Rods"), disappointing holders who had hoped for a new penguin character and sparking community outrage. In January 2022, the community voted to remove the founder, a period often referred to as the "Great Blizzard" period in the project's history.

Luca Netz takes over

In April 2022, the price of the Fat Penguin NFT fell below 1 ETH, and the community was on the verge of disbanding. Luca Netz, a serial entrepreneur who had accumulated wealth through various businesses, proposed an acquisition. Prior to the acquisition, Luca had generated $6 million in net profit from the Fat Penguin IP in five months, ultimately acquiring the project for $2.5 million.

Source: EO YouTube

Luca Netz's upbringing and entrepreneurial background are unique: he endured a difficult childhood, moved over 30 times with his single mother over the course of nine years, and dropped out of school at 16 to work. His first job was packing goods for Ring Doorbell, a startup with just 25 employees. Within two years, Ring Doorbell expanded to over 500 employees and was subsequently acquired by Amazon for $1 billion. This gave Luca his first opportunity to witness the complete lifecycle of a company.

Luca subsequently ventured into online brokerage sales, ultimately achieving success through a model of importing goods from China and distributing them in the United States. At the age of 19, he sold his first company to a competitor, becoming a millionaire. In 2019, leveraging his experience in Instagram marketing, he founded the venture capital firm Netz Capital. In 2020, he joined the clothing brand Von Dutch and helped it recover. He later became Chief Marketing Officer of the toy company Gel Blaster, achieving $100 million in revenue within 14 months. Leveraging his experience as a serial entrepreneur, Luca revived the languishing Fat Penguin.

Recovery begins

After the acquisition, Luca Netz and his team quickly promoted business and community restructuring:

• Business level: Recruit industry consultants covering Web 2 and Web 3 fields to promote the implementation of project planning; in July 2022, cooperate with large toy distributor PMI Toys to launch Fat Penguin IP dolls and figures, and create a Web 3 IP business model - borrow the IP authorization of NFT holders, share part of the physical toy sales revenue with the holders, and enhance community cohesion.
• Brand Communication: Immediately after the acquisition, a fat penguin GIF was uploaded to GIPHY, and short character videos were produced through the Instagram account. Within six months, the total GIF views exceeded 1 billion, and the number of Instagram followers exceeded 100,000, initially establishing brand awareness.
• Industry Collaboration: In November 2022, Sotheby's partnered with the world's largest auction house to auction 10 Fat Penguin NFTs, issuing Soul Bound Tokens (SBT) to buyers. This collaboration marked Sotheby's' first foray into the crypto space. The auction included a penguin NFT of former founder Cole Villemain, raising public awareness of the Fat Penguin and becoming a landmark event for the community.

Source: Sotheby's

Physical products and brand collaboration: opening up market breakthroughs

Build brand influence

One of the core strategies of Fat Penguin to upgrade from an NFT project to a global IP is to strengthen its brand power through social media and Web 2 industry penetration:

Social media communication

Luca Netz incorporated past business experience into Fat Penguin's social media strategy: after the acquisition in April 2022, the team uploaded Fat Penguin GIFs on a large scale on GIPHY, with over 1 billion views within six months. Even users who did not hold NFTs began to use the GIF in their daily communications; Instagram's short video content attracted Generation Z and millennials. Six months after the acquisition, the number of fans exceeded 100,000, and exceeded 1 million by the end of 2024. The high number of reposts further expanded brand exposure.

Penetrating the Web 2 IP Industry

To promote its brand mainstreaming, Fat Penguin actively participated in Web 2 IP industry events, positioning itself as "content that can participate in licensing and pop culture competition" rather than simply a digital asset:

• In June 2023, it appeared at the "Licensing Expo 2023" in Las Vegas - the world's largest licensing industry exhibition. Top IPs such as Disney and Pokémon all participated in the exhibition. For the first time, Fat Penguin used NFT IP as licensable content and established connections with Web 2 companies.
• In July 2023, we established a booth at the San Diego Comic-Con International (SDCC 2023), the nation's largest pop culture event, becoming the first Web 3 brand to have an official booth. The convention attracts over 100,000 visitors annually, and this appearance not only provided brand exposure but also marked the penetration of Web 3 innovation into the traditional entertainment industry.

With its cute character design and community-oriented concept, the Fat Penguin is highly consistent with the mass appeal of Web 2. Through the above-mentioned exhibition, it has broken through the IP licensing threshold, laid the foundation for subsequent brand cooperation, and gradually broken out of the limitations of Web 3 and integrated into the Web 2 ecosystem.

Brand cooperation layout

Source: Pudgy Penguins

Fat Penguin's brand cooperation is expanding systematically:

• Toys and Retail: In July 2022, it cooperated with toy manufacturer PMI to lay the foundation for the production of physical toys; in February 2023, it reached a distribution cooperation with retail company Retail Monster to establish a global toy sales network, and its products entered large supermarket chains such as Walmart and Target, becoming a typical case of NFT projects expanding the real economy.
• Food industry: In November 2022, it cooperated with Kellogg to launch cereal packaging, becoming the first NFT project to cooperate with a mass consumer brand; in 2024, it jointly launched a limited edition fat penguin cookie with the high-end cookie brand Last Crumb, covering young consumers and the high-end market at the same time.
• Technology and Digital: In early 2023, we collaborated with Hologram Labs to develop 3D modeling and AR/VR content for the fat penguin character, laying the groundwork for the metaverse; in February 2024, we partnered with Unstoppable Domains to launch the ".pudgy" domain name service, supporting community members to build websites, send and receive cryptocurrencies in the Web 3 ecosystem, and establish digital identities.
• Fashion and Lifestyle: In early 2024, we collaborated with high-end mobile phone case brand Velvet Caviar to launch a fat penguin design mobile phone case, expanding the IP reach through everyday accessories and further positioning ourselves as a trendy lifestyle brand.
• Entertainment Industry: In June 2023, we will cooperate with WME, a major Hollywood agency, to open up the possibility of expansion in multiple media fields such as film, television, and music, and promote the brand to break through the boundaries of NFT and transform into a global comprehensive IP.

The success of the physical toy business

When Luca Netz acquired Fat Penguin in mid-2022, the crypto market was in crisis: the Terra Luna incident triggered a market crash, NFT trading volume dropped 95%, the royalty system failed, and the price of Ethereum plummeted 80%. Luca was forced to invest additional funds out of his own pocket, even exceeding the initial acquisition price. However, against this backdrop, Fat Penguin's brand power drove a boom in the physical toy business:

Source: @ST_McFly

In May 2023, Pudgy Toys, developed based on community licensing, was launched on Amazon, with sales exceeding US$500,000 in the first weekend. Within 12 months of its launch, sales exceeded 1 million units, with revenue exceeding US$10 million, ranking first in multiple categories on Amazon. In September 2023, the toys entered 2,000 stores of Walmart, one of the largest retailers in the United States, and were named "Best Summer Toy of 2023" by Toy Insider.

In February 2024, the cooperation between Lil Pudgy and Walmart was further expanded, adding 1,100 new stores, covering 3,100 Walmart stores across the United States, and simultaneously launching Walmart exclusive products - 5 collectible figures and 25 "Lil Pudgy Mystery Igloos".

Since then, Fat Penguin Toys has continued to expand its retail channels: entering the British toy retailer Smyths in October 2023; entering Target supermarkets in the United States and Australia's largest supermarket chain Big W in May 2024; entering 2,000 Walgreens pharmacies in June 2025; and cooperating with Basic Fun in February 2025 to introduce products to amusement parks across the United States.

A key feature of Pudgy toys is that they naturally guide buyers into a Web 3 environment: Each toy comes with a QR code that, when scanned, unlocks character traits and collectibles in Pudgy World, an online open-world game powered by zkSync. Users can play and customize their own penguin characters within the game. As of January 2025, approximately 20% of toy buyers enter the on-chain environment through Pudgy World, reaching over 160,000 users. To date, over 10 million Pudgy toys have been sold in over 10,000 stores worldwide.

The success of the physical toy business has enabled Fat Penguin to achieve stable revenue and laid the foundation for subsequent development.

Expansion Signals: PENGU Token Issuance and Abstract Mainnet Launch

PENGU Token Issuance

On December 17, 2024, Fat Penguin announced the issuance of its official token PENGU. Its core goal is to break through the existing community size limitations and build a "global community of billions of people."

Over the past three years, Fat Penguin has achieved remarkable success in the Web 2 space: over 50 billion social media impressions, 1.5 million toys sold in over 10,000 stores worldwide, and millions of social media followers. However, limited by a supply of 8,888 NFTs and 22,222 Lil Pudgys, community expansion faces a bottleneck. The launch of PENGU aims to overcome this limitation, creating a "social currency" that will encourage more people to identify with and participate in the development of Fat Penguin.

Although Fat Penguin is an NFT project in the Ethereum ecosystem, the team still decided to issue PENGU on the Solana chain to reach more users.

Source: Pudgy Penguins

PENGU's token distribution focuses on "expanding ecological participation": the total supply is 88.888 billion tokens, of which 25.9% (approximately 23 billion tokens) are allocated to the community. Based on the market value at the time, the scale of this airdrop reached US$1.5 billion, making it one of the largest airdrops in the history of the crypto industry.

It is worth noting that approximately 24% of the total airdrop was allocated to on-chain ecosystem contributors who were not directly related to Fat Penguin, including active on-chain users of Ethereum and Solana, holders of mainstream NFT projects and the broader crypto community. Ultimately, more than 6 million wallets were eligible to apply for PENGU, achieving a breakthrough expansion in community size.

After PENGU was officially launched on December 17, 2024, the market reacted strongly: the initial market value was US$2.5 billion and the peak reached US$3.5 billion; within a week, the number of on-chain holders exceeded 500,000; within a month of its launch, it became the world's fourth largest meme coin after DOGE, SHIB, and PEPE, and also the meme coin with the highest market value among those issued in the past three years.

Source: Pudgy Penguins

PENGU is listed on exchanges of all sizes around the world, lowering the investment threshold.

Abstract Mainnet Launch

Source: Pudgy Penguins

While preparing for the launch of PENGU, the Fat Penguin team launched a new initiative: developing an Ethereum Layer 2 blockchain, "Abstract." The goal was to address user experience pain points of existing blockchains and promote blockchain mainstream adoption. To achieve this goal, the team secured investment from Founders Fund, a venture capital firm previously invested in Stripe and SpaceX, and acquired the NFT-specific blockchain Frame to strengthen its technical capabilities.

Abstract's core differentiator lies in its positioning as a "consumer-grade blockchain": while most blockchains focus on technical integrity or decentralization, Abstract is focused on providing everyday digital experiences such as gaming, social networking, and entertainment. Its key innovation is a wallet system based on account abstraction—users can log in directly with their Google or Apple accounts to create a wallet, which can be used across multiple applications, reaching both existing crypto users and new Web 2 users alike. This aims to eliminate core barriers to blockchain mainstreaming.

At present, the Abstract ecosystem has developed to a scale relatively independent of the Fat Penguin team, and has also become the infrastructure for the expansion of the Fat Penguin brand: PENGU is used for rewards for anchors on the Abstract portal, and Fat Penguin's self-developed games (mentioned later) are also connected to the chain. In the future, it is hoped that the large-scale Web 2 community accumulated by Fat Penguin will be introduced to Web 3.

The current Fat Penguin: Towards a global top IP

Accelerate global layout

Deepen brand cooperation

By 2025, Fat Penguin will transform into a "global lifestyle brand" through cross-industry collaboration, with the focus of collaboration shifting from "brand exposure" to "integration into daily life":

• Entertainment and Toys: In early 2025, we will collaborate with Basic Fun to launch an amusement park-themed toy line; we will collaborate with PEZ to launch Chubby Penguin-themed candies and candy boxes, incorporating them into the PEZ product line alongside global IPs such as Pokémon and Disney, marking Chubby Penguin as a mainstream character brand; we will collaborate with the classic American smoothie brand ICEE to launch customized ICEE character skins for the game "Pudgy Party", enriching offline activities and brand experiences.
• In the sports field: In September 2024, it cooperated with the Spanish second-tier football team CD Castellón to print the Fat Penguin NFT on the team's jerseys and peripheral products, becoming the first NFT to appear on the jerseys of a professional football team; in August 2025, it cooperated with NASCAR (National Sports Car Racing) to fully present the Fat Penguin brand logo on the racing car of HYAC racing driver Ricky Stenhouse Jr. The car participated in the Labor Day weekend event, one of NASCAR's four most popular events, which not only reached the racing fan community, but also symbolized the integration of Web 3 projects with the traditional sports industry.
• Other areas: Collaboration with Lufthansa's "Miles & More" frequent flyer program allows users to redeem air miles by purchasing fat penguin products; collaboration with streetwear brand VANDYTHEPINK to expand into the fashion market; and launch of joint products with hardware wallet brand Ledger.

Focus on the Asian market

Source: Igloo APAC

Fat Penguin has recently focused on the Asian market and has been collaborating with leading companies through offline activities to enhance its regional influence: its operator Igloo has established an Asia-Pacific branch to promote the implementation of Fat Penguin and PENGU in Asia.

In terms of offline exposure, Fat Penguin placed outdoor advertisements in the core business districts of Seoul and Tokyo through the "Pengu Takeover" campaign, and used entire high-rise buildings in Bangkok for brand promotion.

In terms of brand cooperation, in 2024, it reached a strategic cooperation with Lotte, one of the five largest business groups in South Korea, to launch limited edition collectibles; in February 2025, it cooperated with Minini, the sub-IP of LINE FRIENDS, the largest IP brand in South Korea/Asia; and cooperated with Chinese toy collection company Suplay to lay the foundation for entering the world's largest toy market, China; in August 2025, it launched collectible cards in mainstream convenience stores in Japan, and introduced fat penguin toys to Don Quijote, Japan's largest retailer.

Luca Netz previously mentioned in the 0 xThreadGuy podcast: "Historically, IP has mostly spread from the West to the East, but in the next decade, cultural communication will show a trend of exporting to the East. IP industry practitioners need to pay attention to this change." Fat Penguin plans to seize the Asian market by taking advantage of this trend, enhancing brand awareness through regional localized content, and consolidating PENGU's market position.

Building a gaming ecosystem

To upgrade from a "collectible" to an "interactive entertainment brand," Fat Penguin is actively developing games in the gaming sector, targeting different player groups and developing game products on multiple platforms and blockchains:

Pengu Clash

Source: Pengu Clash

In May 2025, Fat Penguin partnered with Elympics to launch the skill-based game "Pengu Clash" on the TON blockchain. The core gameplay is "pushing the opponent off the iceberg". The rules are simple but strategic.

The game is deployed on both Abstract and TON chains: the Abstract chain version is for PC users, while the TON chain version is available as a Telegram mini-program, allowing mobile users to play directly without downloading the APP, significantly lowering the threshold for participation.

In the first week of its launch, Pengu Clash had over 60,000 players, with 170,000 game sessions; within a month of its launch, the number of players exceeded 200,000, with over 1 million game sessions.

Pudgy Party

Pudgy Party is Fat Penguin's first mobile-exclusive game, a competitive obstacle course game in the style of Fall Guys. Addressing the scarcity of high-quality mobile games, Fat Penguin leveraged its own IP to attract Web 2 mobile gamers. Upon its launch on August 29, 2025, Pudgy Party topped the US App Store's racing game charts on its first day, simultaneously entering the top 30 of the overall free games chart.

The game's core feature is tradable character skins: these skins can be earned through gameplay and event participation, and circulated on the Mythical Games marketplace. The "Power Pudgy" skin, given away free during Comic-Con 2025, currently trades for approximately $4,300, reflecting the high market demand for this type of digital asset.

Vibes TCG

Vibes TCG is a collectible card game (TCG) developed by Orange Cap Games and based on the Fat Penguin IP. The first set of cards, "Enter the Huddle," will launch in the fourth quarter of 2024. The project has previously secured $2 million in seed round angel funding.

The uniqueness of this game lies in its "dual-mode gameplay": it supports the traditional TCG experience of physical card collection, and can also be played conveniently on digital platforms, taking into account player groups with different preferences.

Riding on the recent boom in physical card trading, physical cards of "Vibes TCG" have garnered significant market attention: cards distributed free of charge during the anime expo are currently trading at prices ranging from US$70 to US$150 per card, depending on their condition; a supplementary box containing 10 first-edition card decks recently fetched US$5,000, further confirming the strength of market demand for the IP cards.

Content expansion: layout of children's market

Fat Penguin's cuteness gives it a natural advantage in the children's market, and the rapid growth of the children's market makes it a key area for Fat Penguin's long-term development. Based on this, Fat Penguin actively promotes the development of children's content, the most representative of which are children's book publishing and animation production:

Source: Lil Pudgys

In May 2025, Fat Penguin announced a partnership with Penguin Random House Children's, the world's largest children's publisher, to release its first children's picture book, The Worst Birthday Present. Penguin Random House has long collaborated with traditional top-tier intellectual property (IPs) such as Disney, and this collaboration is expected to bring Fat Penguin IP widespread exposure to children.

Furthermore, the animated series "The Little Penguin Show," which will begin serialization in spring 2025, marks a significant milestone in Fat Penguin's media strategy. Co-produced with TheSoul Publishing, the series tells the story of the adventures of four penguin roommates: Atlas, Eureka, Snofia, and Springer. Set "Under the Iceberg"—a mysterious world hidden within the iceberg—the story leaves ample room for further storyline expansion. Each character in the series possesses a unique personality and background, resonating with audiences of all ages.

TheSoul Publishing, responsible for the production of "The Little Penguin Show", is a world-renowned content production company whose content reaches more than 2 billion people. This cooperation will become an important channel for Fat Penguin to reach global children's audiences.

The future of Fat Penguin: Towards the ultimate form of the world's top IP

Entering the institutional market and promoting the implementation of ETFs

Source: Pudgy Penguins

Fat Penguin is exploring a previously unexplored area for Web 3 IP: institutional finance. Currently, Fat Penguin has appeared in ETF advertisements for major asset management firms like VanEck and Bitwise. These institutions have also expressed their support by changing their social media profile pictures to the Fat Penguin image. Recently, the Fat Penguin team and VanEck jointly rang the Nasdaq opening bell, a first for a Web 3 project.

In March 2025, Fat Penguin submitted an ETF application to the US SEC through Canary Capital, which caused a stir in the industry. The ETF adopted a hybrid "NFT + token" structure rather than a single token model, creating a new paradigm for NFT asset securitization.

Source: Pudgy Penguins

The Fat Penguin ETF's approval process is progressing smoothly. In June 2025, the Chicago Board Options Exchange (CBOE) submitted a 19b-4 application (exchange listing application) for Canary Capital's Fat Penguin ETF. In July, the SEC officially confirmed receipt of the application and initiated the review process. Furthermore, the Fat Penguin team was recently invited to serve as an official regulatory advisor to the US government. This role holds significant long-term strategic value. By participating in the regulatory rulemaking process, Fat Penguin can both create a more favorable market environment and proactively mitigate potential regulatory risks. Furthermore, as a "government-approved project," its status as a "government-approved project" significantly lowers the barrier to entry for conservative institutional investors.

Launching an IPO and entering the traditional capital market

Source: Yahoo Finance

One of Fat Penguin's most ambitious plans is to complete an initial public offering (IPO) by 2027. In August 2025, Luca Netz articulated this goal in an interview: "I would be very disappointed if I can't take the company public within the next two years." This plan is not just a pipe dream, but a concrete plan based on clear performance targets. Fat Penguin has set a revenue target of $50 million for 2025, a key milestone in the IPO process.

If a project originating from NFTs could be listed on traditional stock markets, it would be a groundbreaking event for the industry. A successful launch would fundamentally change the market's understanding of Web 3 assets, demonstrating that NFT collections are not just digital assets but can be developed into real-world businesses with sustainable business models. Currently, Fat Penguin has generated stable revenue streams through toy sales, IP licensing, and brand partnerships, a characteristic that makes it highly attractive to traditional investors.

The ultimate construction of the world's top IP

Source: @jpgKenny

Fat Penguin's ultimate goal is clear: to become a "global IP surpassing Disney." This goal isn't just wishful thinking, but a pragmatic plan based on a systematic strategy and strong execution. In just three years, Fat Penguin has achieved what traditional IP companies take decades to achieve: over 50 billion social media impressions, a global presence in over 10,000 stores, and millions of social media followers. Now, it has built its own blockchain and token ecosystem, establishing a unique presence across Web 2 and Web 3.

Fat Penguin's development roadmap fully reflects this vision: the recently launched "Pudgy Party" will naturally guide Web 2 mobile game players into the Fat Penguin ecosystem; multi-format content such as children's books and animations will promote its full entry into the children's market; the picture book cooperation with Penguin Random House and the animation cooperation with TheSoul Publishing mark that Fat Penguin is transforming from an "NFT project" to a "comprehensive entertainment company."

Fat Penguin's success has profound implications for the entire Web 3 industry: it proves that NFTs are not simply speculative tools, but IP assets capable of generating real commercial value. By issuing the PENGU token, Fat Penguin has expanded its user base to over 600,000, achieving a significant community expansion. By building technical infrastructure through the Abstract blockchain and establishing connections with traditional financial markets through its IPO plan, these initiatives are collectively propelling Fat Penguin toward becoming the "Disney of the Web 3 era."

Fat Penguin's development journey has only just begun, but judging by its achievements over the past three years and its future plans, it's not just a pipe dream; it's systematically realizing its vision: breaking the boundaries between Web 2 and Web 3, connecting the digital and real economies, growing alongside the community, and building a new paradigm for the next generation of global IP. Its goal of a "global community of billions" is no longer a distant dream, but a future that's becoming increasingly clear and within reach.