From NFT blue chips to tokenization experiments, the Doodles entertainment empire's gamble

Author: Lawrence, Mars Finance

1. A Brief History of Doodles: From "Cartoon Avatars" to the Ambition of "Web3 Disney"

As one of the most iconic blue-chip NFT projects in the Ethereum ecosystem, the growth history of Doodles can be considered a textbook case of IP incubation in the Web3 era.

1. The Starting Point of Artistic Genes and Community Co-Creation (2021-2022)

In October 2021, 10,000 colorful cartoon avatars created by Canadian illustrator Scott Martin (Burnt Toast) landed on Ethereum. These NFTs, named Doodles, quickly broke into the mainstream with their unique "childlike doodle" style, causing the floor price to soar to over 5 ETH and earning a spot in the "blue-chip club."

The three founders of the core team—Scott Martin, Evan Keast, and Jordan Castro—each play a key role:

• Scott Martin: Visual soul figure, responsible for all character design and world-building.
• Evan & Jordan: Former core members of CryptoKitties, well-versed in the operational rules of the NFT community.

Unlike other PFP (Profile Picture) projects, Doodles has emphasized the concept of "holders as shareholders" from the very beginning:

• Establish a Doodlebank community treasury, with funds allocation decided by holders' votes.
• Distributing wearable devices through mechanisms such as Genesis Box to achieve dynamic upgrades of NFTs.

​​2. Cross-Border Expansion and Capital Support (2022-2024)​​

2022 became a strategic turning point for Doodles:

• Executive Introduction: Former Billboard President Julian Holguin has been appointed as CEO, and music superstar Pharrell Williams has taken on the role of Chief Brand Officer.
• Capital Action: Completed a $54 million financing at a valuation of $704 million, led by 776 Fund (founded by Reddit co-founder Alexis Ohanian)
• Ecological Layout:
• Acquired the Emmy-nominated animation studio Golden Wolf
• Launched co-branded products with Adidas and McDonald's
• Develop the Doodles 2 dynamic NFT system, supporting cross-platform character customization

At this point, Doodles has evolved from a purely NFT project into a "Web3 entertainment group," with its business landscape covering diverse scenarios such as animation, music, gaming, and offline events.

​​3. Transformation in Crisis (2025)​​

In January 2025, founder Scott Martin resumed the role of CEO and announced a return to the "radical innovation" approach:

• Halt excessive commercialization of collaborations (such as McDonald's coffee partnership)
• Launching the DreamNet ecosystem to build an AI-driven decentralized content platform
• Behind this adjustment is the reality of the continuously sluggish NFT market: in 2024, Doodles' trading volume has declined by 67% year-on-year, with the floor price lingering in the 3 ETH range.

2. Tokenization Breakthrough: The Economic Model and Strategic Logic of DOOD

Against the backdrop of the overall cooling of the NFT sector, Doodles has chosen to break the situation through tokenization. Its native token DOOD will launch on Solana on May 9, 2025, and plans to cross-chain to Base L2.

(1) Token Economics: Benefit Reconstruction under Community Narratives

According to the white paper, the total supply of DOOD is 10 billion coins, and the distribution framework is as follows:

Design Highlights:

• Community First: 68% of tokens flow to the community, higher than similar projects (such as Azuki's 37.5%)
• Multi-chain compatibility: Initially launched on Solana, leveraging its high TPS (65,000+/ second) and meme culture, with future cross-chain integration into the Ethereum ecosystem via Base.

Potential disputes:

• The definition of "New Blood" is vague: 13% of the New Blood allocation lacks transparent rules and carries the risk of internal manipulation.
• Institutional exit pressure: Early investors such as 776 Fund have not announced an exit plan, or may cash out through ecological funds.

(2) Value Capture: The Imagination from JPG to ‘Digital Skin’

DOOD is positioned as the "economic lifeblood" of the Doodles ecosystem, with its value capture mechanism revolving around three layers:

1. Governance Rights

• Proposal Voting: Holders can participate in the decision-making of DreamNet content creation direction.
• Staking Rewards: Locking tokens to receive animated IP dividends, discounts on co-branded products, and other benefits.

2. Consumption Scenarios

• DoodlesTV: Pay DOOD to watch exclusive animated shorts
• Virtual Fashion: Purchase wearable devices on the Stoodio platform
• In-game purchases: Item trading in future metaverse games

3. Speculative Target

• Solana chain's MEME culture boosts trading enthusiasm
• Cross-chain bridging with Base may create arbitrage opportunities.

However, compared to competing products, the practicality of DOOD still appears weak:

• Comparison with PENGU: Pudgy Penguins has generated stable cash flow through physical toys.
• Compare ANIME: Azuki is a binding anime crowdfunding platform with clear consumption scenarios.

3. Deconstruction of Token Issuance Motivation: A Life-Saving Medicine or a Harvesting Scythe?

At a time when NFT trading volume has halved and blue-chip projects are struggling to grow, Doodles' decision to issue tokens has sparked polarized opinions.

Strategic Rationality

1. Breaking the Liquidity Dilemma

The non-standard attributes of NFTs lead to a lack of liquidity. By binding tokens, holders can obtain liquid assets through staking, airdrops, and other methods, avoiding the pressure of selling NFTs at a lower price.

2. Community Activation Experiment

The operation of the DreamNet system relies on token incentives:

• Creators who upload content can earn DOOD rewards.
• Users participate in interactions (likes, shares) to earn points
• This "creation is mining" model attempts to replicate the successful path of StepN.

3. Capital Exit Demand

Early investment institutions need to exit through token listing. Based on a financing estimate of 54 million USD, the DOOD FDV (Fully Diluted Valuation) needs to reach 700 million USD for VCs to avoid losses, while the current market value of Doodles' NFTs is only 64.8 million USD.

Suspected of Cutting Leeks

1. Token Distribution Risks

Despite the community allocation ratio being as high as 68%, the segmentation rules are questionable:

• 30% of the community airdrop has not specified the snapshot time, which poses a risk of "wash trading".
• The ecological fund is controlled by the team and may be used to manipulate market prices.

2. MEME Trap

Choosing Solana for the initial launch essentially caters to the MEME hype culture. Refer to the average lifecycle of tokens on that chain:

• 80% of projects lose 90% of their market value within 1 month of listing.
• Trading volume is concentrated on CEX, and on-chain liquidity is scarce.

3. NFT Reflexivity Risk

A drop in token prices may trigger a wave of NFT sell-offs, forming a "death spiral." After the 2024 Azuki token issuance, its NFT floor price fell by 58%.

4. Market Outlook: Short-Selling Signals and Risk Warnings

According to the model calculations of Marsbit Research Institute, DOOD may show the following trend:

Short-term Speculation Window

• First day of listing: Driven by MEME sentiment, FDV may surge to 1.5-2 billion USD.
• Airdrop Selling Pressure: Based on 30% community allocation, the potential selling volume in the first week reaches 3 billion tokens (approximately 450 million USD)

Medium to Long-term Risks

• Ecological redemption pressure: If the DreamNet MVP product is not launched within 6 months, the token will lose narrative support.
• Multi-chain operational costs: The cross-chain bridge between Solana and Base may become a target for hacker attacks.

Short Selling Strategy Recommendations

Suitable for short signals:

• FDV exceeds 2.5 billion USD (corresponding to DOOD unit price of 0.25 USD)
• The team address has a large transfer
• DreamNet postponed release

Risk Warning:

• The degree of manipulation by major players on the Solana chain is high, and one should be cautious of short squeeze risks.
• Exchanges like Binance may introduce short-selling restrictions.

V. Conclusion: The Paradigm Revolution and Speculative Bubble of Web3IP

The tokenization experiment of Doodles is essentially an adventure about "digital asset securitization." Its idealistic side is reflected in:

• Attempting to achieve value sharing between creators and consumers through token economics
• Exploring the transformation of NFTs from collectibles to "digital identity passports"

But the harshness of reality is equally clear:

• In the interest chain composed of VC, exchanges, and market makers, the community remains in a weak position.
• The maturity of the Web3 entertainment ecosystem is far from supporting a valuation of tens of billions.

For ordinary investors, the advice is:

• Short-term participation: Utilize the liquidity premium arbitrage during the early stage of the exchange's launch, with the stop-loss set at -20%.
• Long-term avoidance: Unless the user retention rate exceeds 50% after DreamNet goes live, it is not advisable to hold positions for more than 3 months.
• Ecological Observation: Focus on the music collaboration with Pharrell Williams and the animation production progress of Golden Wolf.

In the crypto world, "innovation" and "harvesting" are often two sides of the same coin. Whether Doodles can break the curse of "launching a coin equals reaching the peak" will be a key test period in the autumn and winter of 2025.