Shutting Down Operations

Abstract, a Layer 2 Ethereum blockchain, will stop operations by mid-December. The chain was acquired in 2024 as Frame and later rebranded and improved by Igloo Inc., the company behind the NFT marketplace Pudgy Penguins.

Reasons for Shutdown

According to Igloo CEO Luca Schnetzler, the chain's woes were deepened by limited DeFi activity and liquidity. Abstract's TVL (total value locked) contracted by 83%, from $56 million to $9.5 million. The stablecoin market cap, which tracks liquidity, also trended downwards from $12M to $5.6M.

Impact on Users

Users who had invested time and effort in accumulating XP, a reward system for users who brought utility to the platform, are disappointed. Some feel that the company has a duty to launch the token, but instead, it will shut down. Others view the shutdown as a setback for the memecoin PENGU.

Future Plans

Igloo CEO Schnetzler justifies the move, stating that the company cannot justify taking funds from Pudgy Penguins to support a chain that has not found product-market fit. The focus will return to Pudgy Penguins to make it a global and cultural phenomenon.

Investor Response

A $1 million freshly funded wallet jumped in to acquire PENGU. However, the price of PENGU was down 21% from its recent high of $0.01. The pullback and downtrend could be due for a reversal if the $0.0089 support holds.