The Rise of Labubu and the Fall of Meme Coins: The Dual Fate of a Toy IP

In 2024, a plush toy named Labubu sparked a global craze. Designed by artist Long Jiasheng, this sprite character quickly became a darling of pop culture with its unique appearance and backstory.

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The success of Labubu is closely related to the business strategy of its parent company. The company adopts a blind box sales model, cleverly leveraging consumers' curiosity about the unknown. This sales method not only increases the excitement of purchases but also promotes the prosperity of the secondary market.

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As an outstanding cultural IP, Labubu has successfully transcended cultural boundaries, gaining widespread recognition in both Asia and the West. Its success can be attributed to three main factors: the cross-cultural appeal of its products, the patience and innovation of the creative team, and China's well-established industrial chain and mature industrial ecosystem.

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However, the digital assets related to the Labubu physical toys have failed to sustain this success. The similarly named Meme coin LABUBU saw its market value rapidly shrink after a brief hype, and it has currently fallen below $28 million. This phenomenon is not an isolated case; similar digital asset projects, such as Pudgy Penguins, BAYC, and CryptoPunks, have experienced a similar fate.

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Despite the fact that these projects attracted significant investment during their peak, including participation from well-known athletes and tech companies, they ultimately faced a dramatic price crash. This highlights the high-risk nature of the Meme coin and NFT markets, where even digital assets associated with successful physical products struggle to maintain long-term value.

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The case of Labubu illustrates the significant differences between the market for physical cultural products and digital assets. While physical toys can achieve sustained commercial success through innovative design and marketing strategies, the associated digital assets often struggle to escape their speculative nature, ultimately facing the fate of a value bubble burst.

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This phenomenon reflects a common issue in the current digital asset market: assets that lack practical applications and intrinsic value support, even if they can attract significant attention and investment in the short term, are unlikely to maintain their value in the long run. For investors and market participants, this is undoubtedly a lesson worth contemplating.

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