According to Kyunghyang, Sunmi, her agency, FSN, and Hands Studio launched the “Sunmiya Club” PFP NFT (Profile Picture NFT) project in February 2022.
NFT Venture and Promises to Investors
The project featured digital illustrations modeled after Sunmi. It offered exclusive services to NFT holders to enhance the investment value of the assets. The project promised investors benefits such as invitations to fan meetings, exclusive parties, and profit-sharing opportunities.
Sunmi and the issuers actively promoted the project, leading to a successful sellout. She even appeared in YouTube videos alongside MetaKongz CEO Lee Doo-hee, documenting her venture into the metaverse and NFT space.
Market Crash and Rising Criticism
However, in the latter half of 2022, the collapse of Terra-Luna and the bankruptcy of U.S. crypto exchange FTX triggered a market crash. As a result, Sunmi’s NFTs plummeted in value. Once worth millions of won per unit, they now trade for mere tens of thousands.
Critics have targeted Sunmi, accusing her of inaction following the NFT sellout despite her heavy involvement in its promotion. Some investors have accused her of a “rug pull.” In this fraudulent scheme, project creators lure investors with exaggerated claims before abruptly withdrawing funds and abandoning the project.
Investor A, who claims to have put over 50 million won ($37,500) into Sunmi’s NFT, told Kyunghyang, “The issuers asked us to trust them, so we waited, but the project never materialized. It’s unacceptable that no one is taking responsibility.”
Meanwhile, the issuing company defended itself, stating, “We have fulfilled all the milestones laid out in the original roadmap and have continued operations. The funds raised from the NFT sales were used for operational costs and the development of a new platform launched last year.”
With little regulation surrounding NFT projects, particularly those promoted by celebrities, experts warn of a legal gray area. A blockchain industry insider told Kyunghyang, “The problem is that many NFT projects are launched but left unmanaged, with no regulatory framework or preventive measures in place.”