Azuki Community in Chaos After Founder Reveals Rug Pull History

Azuki is undergoing some serious tribulations as one of the projects’ founders revealed his shady rug pull history in the NFT space. Azuki is one of the hottest NFT collections to drop in the past several months. The project saw a stellar rise in popularity which brought forward skyrocketing floor prices as well. Recently, the team behind Azuki also launched a subsequent collection called Beanz. While this all sounds nice and cheerful, some dark clouds have formed around the project. Funnily enough, the turbulent period was brought forward by none other than one of the founders of the project, Zagabond. 

• Zagabond released a blog post detailing his former involvement with three other NFT collections, which he all abandoned at some point
• The Azuki founder and his team created CryptoPhunks, Tendies, and CryptoZunks. Yet all three of these were left behind to community management
• The price of an Azuki on the secondary marketplace OPENSEA dropped from 19 ETH (around $42,000) to as low as 11 ETH (around $24,000). It has since rebounded to 16.2 ETH (around $38,600) at the time of writing.
• The NFT space erupted with accusations and memes following this release

The Zagabond blog post that started it all

Zagabond is one of the core founding members of the Azuki project. On May 9th, he released a detailed blog post outlining his experience in the NFT and web3 spaces to date. Importantly, the text was very revealing about his past involvement with several NFT projects. 

It turns out Zagabond was the driving force behind CryptoPhunks, Tendies, and CryptoZunks. According to the blog post, these were all conceived as experiments, challenging the NFT space and big names in it. Of course, the target was mainly Larva Labs, the creators of the original CryptoPunks.

One of the more important details that stand out in the blog post is that Zagabond left all three of these projects. According to him, CryptoPhunks was best suited as a community-governed project, which is why the team decided to leave. Tendies and CryptoZunks both underperformed and seemingly died of natural causes, at least according to Zagabond.

Still, the pattern is there. Zagabond and his team moved on quickly, leaving behind thousands of community members and jumping on to the next NFT project. Until the present day when they are actively working on Azuki. 

Azuki price volatility

Following the blog post release, the NFT space erupted with reactions, but more on that later. An interesting thing happened to the Azuki collection itself. Considering the rather controversial information shared in Zagabond’s blog post, it is not surprising that Azuki NFTs saw some serious price fluctuations. 

In the past 24 hours, the Azuki floor price went from a high of 19.5 ETH to almost half that at 11 ETH at around noon on May 10th. At the time of writing, the floor price has rebounded to around 16 ETH. This is still lower than what Azuki went for before Zagabond’s blog post. 

Despite the volatile floor, activity on the Azuki smart contracts spiked in the last 24 hours. Some people were rapidly cleaning their bags. On the other hand, others took advantage of the floor price dip and acquired numerous Azuki NFTs. These have already appreciated in value. 

This correlation is what caused an even bigger outpour of opinions on social media. To begin with, Zagabond’s blog post was controversial enough to start a conversation around Azuki. But then, the dip and traders who took advantage of it just put oil in the fire and brought forward even more concerning questions. Did the founders release this post with a shady purpose in mind? To boost trading activity and in turn royalties generation? Time will tell. 

Over the past 24 hours, Azuki generated $25.5 million in NFT trading volume. Royalties for the collection have been set at 5%, which means that team earned over $1.2 million in that period. You can track the collection’s current performance here. 

Community reaction and sleuthing

Unsurprisingly, the NFT community had a lot to say in the past 24 hours, and Azuki was the hottest topic. While celebs like Steve Aoki were publicly showing off their newly-purchased Azuki NFTs, other members of crypto Twitter were dissecting the details revealed in Zagabond’s post. 

This Twitter thread by aaalex.eth (who owns Phunk #9161) shed light on some other allegations relating to the Azuki collection. In the thread, aaalex.eth details that the Azuki Beanz metadata was supposedly leaked 5 hours prior to mint, allowing bots and collectors to target rare NFTs. Additionally, he points out that Zagabond and his team collected royalties from all three “failed” projects before leaving them. 

Another Twitter user brought forward the fact that despite Zagabond’s claims, all three of his projects did go through the minting phase, and CryptoPhunks even minted out. Importantly, it looks like Zagabond was working on all these collections simultaneously, which might be considered a red flag as well. 

Last but not least, a rather concerning detail also popped up in Twitter threads following the blog post release. Allegedly, Zagabond was impersonating a female named Amanda when he was working on CryptoZunks through this Twitter account, 0xMandy. 

Several hours after these accusations came to light, Zagabond posted on Discord that there was a team member named Liz, who was actually the account owner of 0xMandy. Still, there’s no way to be sure who’s wrong or right in this puzzling situation. 

What’s next for Azuki?

One important note to make here is that there have been no official announcements from the Azuki team as of the time of writing. The last tweet on the official Twitter account is from May 7th, and so is the last post in the Discord announcements channel. Despite that, it seems the mods and community are active on Discord. 

Importantly, Zagabond is scheduled to appear in a live Twitter Spaces event later today. You can tune in here. Hopefully, this event will shed some light on the accusations circling around Twitter. In the meantime, the Azuki floor price seems to be headed in a positive direction, which should be a good sign for holders. 

To end things with something lighter, the Azuki situation also became an inspiration for comic interpretations. Check out this funny video linking the Azuki drama to the current turbulent times for UST and its peg problems. 

Stay tuned as DappRadar will continue following the unfolding drama surrounding the Azuki collection and its founders. You can get the latest NFT news by following the DappRadar Twitter account and turning your notifications on.