The Azuki project killed by its founder goes from $ 115,000 to $ 12,000!

Despite the hundreds, if not thousands, of NFT projects launched since the NFT avatar scene exploded in early 2021, few have gone from zero to hero, let alone make a comeback. The story of Azuki is one of these stories: that of reaching the absolute heights of the hype and falling into relative mediocrity.

the climb

Launched in January 2022 by four anonymous founders, Azuki was one of the few collections of NFT avatars that everyone thought had done everything right. The execution of Chiru Labs, the startup behind Azuki, was so good that many were immediately convinced that the project could become “the next Bored Ape Yacht Club”- then and still today the finest NFT collection in the industry.

The community was vibrant and growing. The roadmap, or as Azuki called it, the “Mind Map“, It was promising and well thought out, but perhaps more importantly, it existed. Many such NFT collections don’t have a roadmap at all, let alone a team capable of executing it. Azuki seemed to have it all and was lucky to be recognized by the community. The 10,000 coin collection was sold out upon release, priced at around 1 ETH each. Sales on the secondary market immediately started to increase, reaching a minimum price of around 7 ETH in the days following the release and of around 15 ETH by the end of the month.

In mid-March, the collection’s minimum price dropped to around 9 ETH and interest dropped slightly, but then Chiru started offering surprises the community couldn’t live without. On March 30, the team lost 20,000 NFTs “Something“To the owners of Azuki, rekindling the massive interest of speculators for the collection and”SomethingThe day after the airdrop, unwrapped digital gifts, later unveiled as Azuki’s avatars called BEANZ, reached a minimum price of around 3.14 ETH, bringing the cumulative airdrop value to over $ 213 million. This equates to a payment of approximately $ 21,000 for each Azuki Avatar Collector owned.

Ahead of the air launch, the minimum collection price has doubled from around 9 ETH to around 34 ETH, or an approximate value of $ 115,000. In April, internet skaters were at the top of the digital collectible hype ramp. It was then that talk about Azukis reaching blue chip status and even potentially buying BAYC started heating up on Twitter. In April, BAYC’s low price fell from around 110 ETH to its all-time high of around 155 ETH, while Azukis was trading at around 30 ETH. However, the talk of flipping continued and many collectors seemed to believe it.

However, until one of Azuki’s anonymous founders, Zagabond naively he decided to make a big mistake: talking about his past failures.

The fall from grace

On May 9, Zagabond published a blog post titled: “A Builder’s Journey”. In it, he opens up about his past failures in the NFT space and exposes some of the lessons he has learned from his journey. “During these formative periods, it is important for the community to encourage creators to innovate and experiment. Additionally, each experience includes key lessons“, he has declared.

Even if his intentions were pure, in hindsight, this was one of the worst mistakes Zagabond could make, as it only tarnished the flawless brand that Azuki had built so far by associating it with questionable projects that many community members later dubbed a downright scam. . He revealed that he managed CryptoPhunks, Tendies and CryptoZunks, three NFT projects that eventually disappeared.

CryptoPhunks was hit by a Digital Millennium Copyright Law (DMCA) after receiving a withdrawal request from CryptoPunks – the first NFT collection to achieve blue chip status – Zagabond was forced to withdraw it. But she didn’t do it without getting rich, as she pointed out a Twitter user. According to the chain a few months after CryptoPhunks went bankrupt, its creator performed a “washing tradeon the LooksRare NFT market for a profit of 300 ETH after increasing the creator’s royalty rate to 5%. Wash trading is a form of market manipulation performed to artificially inflate trading volumes for a specific asset. It is illegal in traditional markets because inflated trading volumes can lead investors to believe the business is generating genuine interest.

Zagabond’s second NFT experiment, Tendies, failed from the start, with only 15% of the collection minted at launch. However, a collector who calls himself 2070 on Twitter has indicated that Tendies was actually a staging. According to the anonymous collector, who allegedly participated in the Tendies sale, the project ceased all activity after launch, abruptly canceled all its social networks and closed the Discord channel within a month of the sale.

Along with CryptoZunks, Zagabond was ousted for engaging in questionable behavior to promote the project on social media. Prior to launch, he allegedly posed as a woman named Amanda and used CryptoZunk’s female profile picture on Twitter. To many observers, Zagabond presented himself as an opportunistic founder of NFT who moved from project to project with little consideration for investors until he hit gold.

Finally, when Zagabond scored gold with Azuki, he managed to turn it into lead, severely damaging the project’s reputation. Within days of publishing her blog post, Azuki’s price more than halved from around 20 ETH to around 7.5 ETH.

The progress

While many NFT projects have come and gone over the past year, the internet skater’s disgrace will likely go down in the NFT history books as one of the worst in history. Not because Azuki had hit rock bottom, far from it, but because it was one of the few projects that seemed to have a real chance of dethroning the two industry darlings, CryptoPunks and Bored Apes.

And although azukis are still very expensive, with the collection remaining the 11th largest by total market capitalization, their drop – measured from peak to current price – is hard to overstate. At their peak, Azuki’s minimum price was around $ 115,000. Today it is around $ 12,000, which is almost a tenfold drop from the maximum. For comparison, CryptoPunks and BAYC have raised around $ 440,000 and $ 435,000 at their all-time highs and are now trading at around $ 127,000 and $ 114,000 respectively.

The bright side of this story is that Azuki’s decline can be used to teach NFT collectors a valuable lesson: every reputation-based project, even the most promising, is a naive mistake to keep from falling into obscurity.

Azuki’s story isn’t over and collectors may very well witness an arc of redemption, but the old adage still holds true: Reputation is like a house of cards – it takes a long time to build, build and fly away fast.

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