Web3 Watch: Who needs an igloo? Pudgy Penguins is getting an L2

Pudgy Penguins had receded a bit from headlines after a late 2023 that saw the NFT collection turned intellectual property brand roll out its plushy toys in stores and tease an online game.

But that shifted this week when the collection’s parent company, Igloo Inc, raised $11 million in a round led by Founders Fund to develop a layer-2 blockchain called Abstract, Decrypt reported.

Igloo Inc quietly launched in June as Pudgy Penguins’ parent company, aiming to drive “the consumer crypto revolution.” Now, the Founders Fund-led round went to Igloo, and its Abstract layer-2 is meant to be the “chain built for the next generation of consumer crypto.”

Abstract is based on ZKsync’s zkStack virtual machine, and aims to make use of account abstraction to make the user experience smoother. It will also use EigenLayer’s EigenDA data availability service.

Igloo in June acquired Frame, which had previously been building a layer-2 for NFTs using Arbitrum’s Nitro tech stack with the hope that the Frame team would assist in building Abstract.

In an X post, Founders Fund partner Joey Krug said the firm was drawn to Pudgy Penguins and its new layer-2 vision partly because of its ability to acquire customers while making money through its in-store sales for NFT-based toys.

“[W]henever someone buys a pudgy penguin in stores like @Walmart and @Target, @IglooInc actually makes money on those sales, and it’s basically a way to not only […] pay for users, but actually acquire users profitably, which is extremely novel within crypto,” Krug wrote.

Telegram CEO is bullish on the app’s games

Telegram CEO Pavel Durov has had something of a winding road with crypto, having been forced to shut down the messaging app’s attempt to launch a crypto token following an intervention from the US Securities and Exchange Commission.

But years later, Durov is still plugged into crypto and Web3 initiatives on the platform. In his private channel this week, he shouted out the TON-based minigame Catizen for earning $16 million in in-app purchases.

And a week ago, Durov said that during July, Telegram would introduce a “mini app store and an in-app browser with support for Web3-pages.”

Also this week, Tonkeeper worked “in close cooperation” with the core team behind TON to launch a smart wallet for the network.

One interesting stat:

Polymarket saw over $27 million in trading volume on both Tuesday and Wednesday, a record high for the prediction market, according to a Dune dashboard.

Also of note:

Epic Games CEO Tim Sweeney said “perhaps someday” blockchain will be used in the popular battle royale game Fortnite.
The crypto exchange OKX launched a Telegram mini-app where users guess the price of bitcoin.
Ethereum-based game Illuvium went live on the Epic Games store.

Get the news in your inbox. Explore Blockworks newsletters:

The Breakdown: Decoding crypto and the markets. Daily.
Empire: Crypto news and analysis to start your day.
Forward Guidance: The intersection of crypto, macro and policy.
0xResearch: Alpha directly in your inbox.
Lightspeed: All things Solana.
The Drop: Apps, games, memes and more.
Supply Shock: Bitcoin, bitcoin, bitcoin.