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Igloo, the company behind Pudgy Penguins, has announced that its Abstract blockchain will close on Dec. 15, 2026, after losses of tens of millions of dollars. The Ethereum layer 2 announced the decision on Oct. 6, four days after Blast disclosed its own shutdown plans. Abstract users must transfer their assets before the network stops operating.
Igloo CEO Luca Netz said the company had funded Abstract for about 18 months. He cited weak growth, limited trading liquidity, a small decentralized finance market and low institutional participation among the problems facing the network.
Abstract launched its mainnet in January 2025. It aimed to bring mainstream users into cryptocurrency through games, entertainment and other consumer applications. As an Ethereum layer 2, it processes transactions separately and sends batches to Ethereum for verification.
The project reported onboarding more than 400,000 users and hosting more than 144 applications. Its partnerships included Disney and Red Bull Racing. Nevertheless, the team said a blockchain focused exclusively on consumer crypto had proved unsustainable as a standalone business.
Pudgy Penguins supplied the consumer brand behind that approach. The business began with cartoon penguin NFTs, which are digital collectibles recorded on a blockchain. It later expanded into toys, games and merchandise, including products sold through Walmart and Target.
Netz said Igloo considered raising additional funding through an Abstract token or an initial coin offering. Instead, the company decided to end its financial support and direct resources toward Pudgy Penguins, its NFT collection and the associated PENGU token.
“Even after losing 8 figures, we could have launched a token or pursued an ICO. Ultimately we decided against this,” Netz wrote on X.
He said the company lacked confidence in the demand needed to support a token. Igloo also decided against using more money from the Pudgy Penguins business to keep Abstract operating.
The network reported more than 325 million transactions, about 4 million wallets and USD 6 billion in decentralized exchange trading. It also said businesses using Abstract had generated more than USD 40 million in revenue.
Those businesses collect revenue separately from the fees Abstract charges to process transactions. Games can earn money through purchases, while trading platforms collect their own fees. The blockchain receives transaction charges and must pay its operating expenses from its available funding.
DefiLlama figures cited on Oct. 7 showed roughly USD 3,900 in chain fees during the preceding 24 hours. Applications on Abstract generated approximately USD 39,000 in revenue over the same period.
Abstract has directed users to move their holdings through its Migration Hub or native bridge before Dec. 15. The team warned that users would lose access to funds left on the network after the shutdown.
About USD 76 million remained on Abstract under DefiLlama’s bridged asset measure on Wednesday. That figure measures assets transferred to the network and differs from revenue earned by its applications or fees collected by the chain.
The announcement follows Blast’s Oct. 2 decision to close its Ethereum layer 2 since operating costs exceeded revenue. Blast previously attracted more than USD 2 billion in deposits and counted investment firm Paradigm among its backers. Abstract’s migration deadline gives its users until December to withdraw their remaining holdings from the consumer-focused blockchain network.
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