The Doodles ecosystem, once a shining star in the NFT space, has faced a sharp decline following the much-anticipated DOOD token airdrop on May 9th. The fallout mirrors previous controversies surrounding similar projects like Pudgy Penguins , with both the token and NFT values plummeting as profit-taking behavior overwhelmed the market.
The Aftermath of the DOOD Token Airdrop
The release of the DOOD token triggered a significant sell-off, causing its market cap to plummet from over $100 million to just around $54 million, marking a 46% drop in less than 24 hours. According to DEX Screener, this decline reflects widespread profit-taking behavior among holders, a common phenomenon after token airdrops.
Compounding the issue, Doodles’ main NFT collection also suffered a severe blow. On OpenSea, the floor price of each NFT fell from 3.5 ETH to less than 1.38 ETH, representing a staggering 62% drop. With ETH trading at approximately $2,336 at the time, the entire NFT collection is now valued at roughly $31 million, down significantly from its previous worth.
Market Volatility Before and After the Airdrop
Leading up to the token launch, Doodles’ NFT trading volume surged by 97% on May 8, driven by speculative trading ahead of the DOOD token airdrop. Over the last seven days, Doodles NFT sales reached $2.6 million, a 350% increase compared to the previous week, according to CryptoSlam.
However, this spike in activity was short-lived. The post-airdrop sell-off underscores the inherent risks of issuing tokens without a robust strategy for maintaining value or managing supply.
Parallels with Pudgy Penguins
This scenario echoes the fate of another major NFT project, Pudgy Penguins, which experienced a similar crash after launching its PENGU token in December. Despite an initial market cap of $2.8 billion, the token lost 50% of its value on its first day and has since dropped to approximately $900 million.
Both cases highlight a recurring issue in the NFT space: while token launches generate excitement, they often lack sustainable mechanisms to retain value. Without proper governance, price retention strategies, or utility, these projects struggle to maintain long-term investor confidence.
What Is Doodles NFT?
Before DOOD, there was Doodles: a 10,000-piece generative NFT collection launched in October 2021. Known for its vibrant pastel palette, hand-drawn characters, and whimsical aesthetic, Doodles quickly became one of the most beloved projects in Web3.
Each NFT in the original collection is a unique, programmatically generated profile picture (PFP), combining traits like hats, hair, backgrounds, and accessories. From cats in space suits to skaters in banana suits, the charm of Doodles lies in its playful absurdity.
But the art was only part of the appeal. Doodles pioneered a community-first approach , granting NFT holders early governance rights, including voting on roadmap proposals and treasury allocations. This participatory model fostered one of the most loyal communities in the NFT space.
Over time, Doodles evolved beyond a simple collectible into a Web3 entertainment brand, incorporating games, music, wearables, real-world events, and now, a full-featured ecosystem token. In many ways, Doodles NFTs laid the foundation for DOOD, transforming from digital art into passports for an expanding universe of creativity and ownership.
Lessons from the Decline
The recent crash serves as a cautionary tale about the risks of token issuance in the NFT space. While Doodles successfully raised $54 million with a valuation of $704 million, the project’s current struggles demonstrate that even well-established brands are not immune to the pitfalls of poorly executed tokenomics.
For Doodles, the challenge now is to rebuild trust and stabilize its ecosystem. Analysts suggest that introducing stronger utility for DOOD, enhancing governance mechanisms, and implementing transparent supply management could help mitigate future declines.
Final Thoughts
The sharp decline of Doodles’ DOOD token and NFT values highlights the volatile nature of the crypto and NFT markets. While airdrops can generate excitement, they often lead to profit-taking and diminished confidence if not accompanied by sustainable strategies.
As the dust settles, the Doodles team must focus on innovation and value creation to restore its position as a leader in the Web3 space. For investors and enthusiasts, this episode underscores the importance of due diligence and skepticism when evaluating token launches and NFT projects.
