Spending a huge amount on a hyped NFT project is no guarantee that the team would deliver. Many investors are having to swallow this bitter pill as a $10,000 NFT project became the laughing stock of Crypto Twitter over the weekend.
Last month, an NFT project called Pixelmon raised over $70 million from investors, with each digital collectible selling for as high as $10,000. However, upon revealing the artwork, it became obvious that investors may have paid for worthless jpegs.
While the definition of “art” is subjective, the quality of the Pixelmon NFT characters has left many owners flummoxed but not speechless. Many users have taken to the social media platform to call out the team behind the project, point out the fact that the final product was a far cry from earlier teasers.
For some context, the anonymous team behind Pixelmon promised users that they’d receive “the largest and highest quality game the NFT space has ever seen.” To this end, they began a presale of their “Pixelmon – Generation 1,” which ended on February 7.
7,750 NFTs were sold through a Dutch auction, with the price dropping by 0.1 ETH every 10 minutes. The starting price for the auction was 3 ETH (around $9,500 at the time). By the end of the sales, the Pixelmon team had raised $70 million.
Following the reveal, the current price of the Pixelmon NFTs has crashed to 0.45 ETH (about $1,250) on OpenSea.
Interestingly, while one should have expected the team to pack its bags and leave, the founder of Pixelmon, aka Syber, has admitted that the team “made a horrible mistake,” adding that he has let himself down. He wrote:
I’m not going to sugar coat it – we made a horrible mistake. To put it simply, we are sorry. This is unacceptable. We felt pressured to push reveal and the reality is we weren’t ready to push the art work. This does not represent the brand and we will fix this as we have let many people down with this reveal.
Moving forward, Syber has promised to dole out around $2 million to completely revamp the NFTs by hiring “a reputable studio to do these redesigns.” However, his comments were not enough to pacify the already angry community. For some perspective, the said $2 million is just 3% of the total funds raised.
To make matters worse, the Pixelmon team reportedly spend some of the raised funds on personal NFT purchases. One user said in the project’s Discord channel that the project used the fund to buy BAYC clones and Azuki NFTs.
Confirming the allegation, Syber replied, “market took a dip so our dev team wallet purchased a few nfts,” with a smiling emoji.
Going by the latest turn of events, the affected buyers should not expect any refunds or a revamped project. According to “Jason,” another member of the Pixelmon core team, refunds don’t work in the NFT space.
Commenting on the saga, a Twitter user admonished investors to avoid unknown teams with no product.
I’m sorry y’all got rugged on Pixelmon but I hope this teaches the space a valuable lesson on where to put money. Undoxxed founders with no product being the last place in the world to put $70m.