The Clarity Act, also known as the Digital Asset Market Clarity Act, is a proposed U.S. bill that aims to separate crypto projects into two categories:

1. Decentralized Commodities (e.g., BTC, ETH), which would be regulated by the CFTC (Commodity Futures Trading Commission).

2. Centralized Securities (businesses), which would be regulated by the SEC.

Before the Clarity Act, projects typically had to register with the SEC and comply at all times. The proposed legislation now allows projects to raise capital without full SEC registration if they meet the decentralization criteria of a commodity within four years. After that deadline, projects that have not reached decentralization would face a penalty.

This change eases the raising and launching of blockchains while also reassuring current builders that they can redistribute value to their token holders.

Let's examine how this could impact Decentralized Physical Infrastructure Networks (DePIN).

II. The Current State of DePIN

The promise of disrupting large monopolies with the help of token incentives to generate network effects is still alive. DePIN still allows the creation of a network from scratch at a very low cost and enables building networks on top of open-source hardware.

A few projects have seen growing network effects, such as Helium, Geodnet, and Aethir. Yet, many tokens are currently performing poorly.

Major sources I've noticed, such as a16z and the World Economic Forum, are still bullish on the sector as of November 2025, posting about ambitious projects within the space.

They do not hide how difficult it is to build in DePIN but continue to fund projects that aim toward this goal. The objective is ambitious and offers a much better future than their centralized alternatives. While we hope it works out for most of them, let's examine the challenges they face.

III. The Challenges of DePIN

1. Building with Hardware is a Nightmare

• Hardware development is significantly harder than software development:

• You have to design it.

• You have to manufacture it.

• Will it work reliably in the field?

• Can it work in harsh conditions?

• Is it safe to use?

• Production times are slower.

• Subject to supply chain issues (requiring every component to be available at all times to finish production).

Decentralized Physical Infrastructure requires hardware, which not only takes time but also requires lots of iteration.

2. The Trilemma of DePIN

Building in DePIN requires developing:

• A blockchain

• A sustainable economy and tokenomics

• Hardware

• A business combining all three

This explains why the space is moving quite slowly.

3. Incentive Design is also Very Hard.

DePIN projects can be manipulated in many ways.

1. Service Manipulation
   A self-interested actor could lie when providing a service, making the network untrustworthy.

2. Sybil Manipulation
   Imagine you pay $1 to get some random data, such as position data, and the provider is paid $1 plus token incentives. It becomes profitable for a provider to buy their own service and extract value from the network.

Solutions exists like introducing randomization for the service providers or restrict network participation. You also need a protocol that collects value, verifies the work, and distributes the value accordingly. But this need to be implemented.

Designing a network of incentives is very hard. Any mistake can lead to exploitation and cause your token's value to drop to zero. Centralized companies don't face this issue as they are their own service providers and can be trusted.

See this article and this article if you want to know more about this topic.

4. Network Effects Take Time

Even if DePIN allows projects to bootstrap a network much faster than any other method out there, crypto people still expect quick returns on investment and won't commit capital otherwise.
You need big players investing in these things with a very high degree of uncertainty until their plan works out (or fails).

5. Regulatory Capture

Nobel laureate George Stigler discusses how regulatory capture works in his paper The Theory of Economic Regulation, but large monopolies typically have money, power, and incentives to maintain their unfair advantages. They can easily obliterate any newcomer by providing votes (from their employees) and money to politicians while those politicians pass laws that allow them to keep an unfair advantage.

IV. How the Clarity Act Could Help

The Clarity Act makes it significantly easier to raise money and redistribute profits as a blockchain project. This simplifies the lives of DePIN projects and allows them to complete their economic loop.

They still have complex problems to solve, but now they have a way to establish a clear business model after they reach critical mass.

How to Raise Capital Before the Act?

A startup issues “ProfitCoin” promising 20% of net revenue → Must register with SEC or limit to accredited investors → Cannot advertise “earn dividends” publicly.

After the Act

The same startup uses the Investment Contract Exemption → Raises $10M publicly, promises 20% revenue share → Files Form ICE-1, launches testnet in 9 months, mainnet in 12 → After year 2, the blockchain is more than 80% decentralized → becomes a digital commodity → Revenue share is now sent via smart contract, the CFTC regulates the platform, not the SEC.

If the Clarity Act were to pass now, every DeFi protocol would be considered decentralized enough and would not be categorized as an intermediary in the financial loop (meaning no need for KYC to trade on it - source). This would make the trading of energy, for example, much easier.

In the end, the Clarity Act makes it easier to launch and redistribute profits for crypto protocols and is a huge net positive for the DePIN space and other sectors within the ecosystem.

V. My Perspectives on the Future

The DePIN sector is often described as a revolutionary sector that will be able to power smart cities. It would allow physical products and people to trade energy surplus and services on a blockchain, powering a set of smart objects that operate in cities. I think society is not ready for this and lacks critical infrastructure, and DePIN ecosystems like Peaq or IoTeX might be selling an unachievable dream (my opinion can change on this).

A few projects seem to be growing, like Aethir, Helium, and Geodnet, but are still very limited. For example, as of today, you can only buy Helium phone data in the US, despite the project having incentivized hotspots for years. This still takes lots of time.

I've highlighted the problems DePIN projects have to overcome, and this makes me super cautious about investing. DePIN hardware is generally built on open-source hardware, making it transparent to build on top. This will allow the hardware sector to evolve at the pace of software, and this will be a true 0 to 1 moment. As the sector continues to expand, I will continue to watch closely until a critical mass for the distribution of hardware and sustainable tokenomics is reached.

What I find particularly interesting is the DePIN energy sector, as AI electricity consumption increases, so too do electricity prices. People are starting to get priced out by their electricity bills and seek more sustainable energy sources. Here comes DePIN, which plugs into these sustainable energy sources and allows them to earn from the energy surplus that can't be stored, earning from two sources ("free" renewable energy and the sale of energy surplus). Electricity consumption growth won't stop soon, and this represents a clear value proposition from the space. Entering this space for DePIN projects is subject to heavy regulatory capture, typical of any monopolistic environment.

Let's see if Memeland can reproduce what Pudgy Penguins did. But first, let's see what Pudgy did well, and how is Memeland positioned right now. This won't be a bull post, I'll share all the bearish arguments I see at the end of the article.

Here we think critically.

I. Explaining the success of Pudgy Pengins

a. The Pudgy path since the beginning

The floor was around 0.7 ETH when Luca bought the collection, it is now at 9 ETH as of October 2025. The NFT collection was in bad shape, yet it is now the biggest NFT project. What step did they take in order to make the Pudgy Penguins IP a success ?

1. Building trust amongst holders

Like anything in the crypto space, holders were unhappy with the way things went. Whether it was before the buyback or after. You always have unhappy people, so Luca focused on building trust with the community as well as building the foundation for the things to come.

He started securing the trademarks (back when it was very hard to get a blue check on Twitter). He started setting the right legal framework in place for how he saw the IP evolve. He also chatted with holders every day for a period of time to gather their feedback. And actually, he learned lots of things which he says made Pudgy what it is today. So, the Pudgy community, by individual holders is actually a very big part of the Pudgy success, and the community is very special in that way. He also spent lots of money on IRL events to make good impressions on people (actually important to him when everything is digital and anon).

2. The GIF cheatcode (reproducible)

GIF are actually a huge component of the Pudgy success, and I'm quite surprised this hasn't been reproduced a lot amongst other web3 IPs. The cost for 1,000 impressions is a fraction of a fraction of a cent according to Luca (source), which is extremely low for any marketer. Usually marketing teams don't use GIFs because they do not convert, but this is different for IPs, as their value lies in mindshare. This is even more impactful when the IP is financialized because that mindshare is converted into IP proliferation and price goes up. As of today Pudgy Penguins has 60B views on giphy alone. I keep track of this data to compare NFT projects.

3. NFT licensing

NFT licensing was a key step in Pudgy's success as it signaled Luca was here to have a positive impact rather than extract like most other NFT collections. It had not been done before because it was very hard to achieve legally, yet they did it and sent a very positive signal to the market as well as the community.

4. Physical toys in Walmart

There's a huge difference in brand perception once someone actually gets a physical object in its home. A customer will not have the same relationship with a random kid show compared to a kid show where they own many items from the IP. This applies in any business where you want to have a relationship with your customers.

Once people buy physical items to display at their houses, the relation gets closer.

Pudgy also used this opportunity to onboard them to the blockchain via QR codes on the Pudgy plushies. We'll see later how this alone could justify a big premium on $pengu.

5. $pengu ETF filing

As of now, the ETF is not approved yet. But under the Trump administration and with the new regulations put in place, the $pengu ETF has a much higher chance of being approved. The Pudgy Penguin IP is using blockchain to create a community around an IP. This novel mechanism could be interesting for institutional capital that wants exposure to innovative IPs. And this would be a very big deal for Pudgy Penguins being the first community to get its ETF, giving them a very big lead.

6. $pengu is an evolution of memecoins

$pengu started as a memecoin. $pengu is a memecoin. Except it's also a brand and an IP. It spreads as a meme and the company behind it creates memes, makes it go viral and redirects value to the token. This is very different than most of the memes that live and die quickly because content isn't as valuable as we think. This is a very important shift to understand if we want to understand what Memeland is doing in my opinion.

b. The $pengu premium

This article is about $meme but looking at marketcaps between other brands like Rekt, Doodle, Azuki, .. They all are in a 100-200M$ range. Why would $meme be a buying opportunity as its valuation is in the same range ? Yet here is $pengu that is around 2-3B$ marketcap when others barely go over 100-200M$. Why this difference and can this premium be earned by other IPs ?

The main reason I see for $pengu having this premium is how they're capturing retail. They already have the biggest mindshare compared to other crypto brands. Retail already knows them and saw them somewhere, at least in Walmarts, increasing the lindy effect of the brand.

In business, the closest a business can be to its consumer the bigger the margins. First because they can set the prices. They gather immediate feedback on products and services they provide, allowing rapid iteration to meet product market fit. This is a very big deal. They also have bigger bargaining power when making deals with other companies.

Conclusion

Pudgy Penguins started in the memecoin category. Became an IP company. Now it's more than just an IP company, it's a Web3 distribution company. They distribute web3 products and onboard people to blockchain via their IP. They have a suite of products where they're onboarded and this is what makes the IP valuable. They have to focus on this suite of products as well.

What made Pudgy Penguins a success is
1. The proliferation of an IP that is financialized

2. Huge retail penetration

3. A suite of products to monetize each user in the long run

Now let's see how this relates to Memeland and how they could remake the same path while actually being 20x cheaper.

II. Memeland reproducing the Pudgy roadmap

Memeland is a crypto company built by the founders of 9gag (the biggest web2 meme platform). Memeland released their first NFT collection, the Potatoz in July 2022 and released two other collections since then (Captainz and MVPs). 9gag recently made it clear that they want to link their web2 business with their web3 branch, and they're going it via their IP: Potatoz.

The Memeland whole ecosystem has three components, each one addressing one market:

• Web2: 9gag

• Web3: Memeland

• Capital market: MemeStrategy

Let's unpack all of them and see what value they can bring to the brand.

a. 9gag, the internet giant

9gag is a meme platform founded in 2008 where people share funny pictures, GIFs or videos, for free. Today they have 200M users and are one of the biggest website in the world. It's a pretty simple product. Even if 1% of this is converted to Web3 in one way or another, it would have a big impact on the ecosystem.

▼Source

9GAGCEO

@9gagceo

200M+ users.
100M+ followers.
1.4B monthly video views.
That’s the scale of @9GAG today.

And from here, Potatoz will be at the center of it all

This exposure is big for what we’ve been building. One IP that carries our Web2 distribution and extends it into Web3: @Memeland,

9GAG ❤️ Memeland

@9GAG

Introducing Potatoz, 9GAG’s official mascot.

200M+ fans worldwide will now experience 9GAG through one mascot across every product and experience.

Potatoz badges coming soon on 9GAG.com

241

16:26 • 2 oct. 2025

b. Memeland, the Web3 gateway

Memeland has lots of products, and so far, let's be honest, they have not been successful, but they might play a big role in the big vision and the new moves that 9gag is making with Potatoz. So it's important to know what they are.

c. MemeStrategy, the capital market

I spent a big part of my time studying MemeStrategy. MemeStrategy was recently bought by Ray Chan (founder of 9gag and Memeland) and was a providing telecommunication equipment. It now has a completely different business. They still talk about IoT but I personally don't see any link whatsoever with what they're doing, so I assume they keep it for the meme.

MemeStrategy has a few different vectors.

There are two main ideas behind MemeStrategy:

1. How can we combine AI, blockchain and culture together: take blockchain and IP together onchain with AI.

2. Bridge Web2 and Web3 via capital markets

I have a few ideas of what it could look like, but they are very very speculative. These ideas are just mine, based on my subjective interpretations of the public information provided here.

Idea 1: MemeStrategy only accumulates $meme and stakes it on Stakeland

We previously saw the Memeland product: Stakeland. A staking platform where $meme stakers receive airdrops from Memeland partnerships (live since 2023). MemeStrategy is said to build more partnerships with creators. They could buy $meme and stake it with the community on Stakeland and receive "free tokens" by staking it on Stakeland. This would ensure a 0 financial loss for investors and fit into the "prudent and long term investment framework" by limiting the downside of the Treasury.

This would also dillute the organic community $meme stakers and is quite unlikely in my opinion.

Idea 2: Direct partnerships with creators

Basic idea, they take serious meme creators and sign deals with them in exchange of token supply from tokens they launch.

Idea 3: Using liquidity providing on memes to create revenue

Here they would accumulate memes from Moonit very early and provide liquidity on them. They would earn a revenue based on volume and provide revenue to their shareholders.

Idea 4: No investment from MemeStrategy, simply take a fee from volume and hold them in the treasury

Like PumpFun, they take a fee on the trading volume and hold the tokens in their treasury

Idea 5: Direct partnership with other businesses

Many businesses are succeeding with their IP coins (Pudgy Penguins, Rekt, Doodle, Nobody Sausage, ...). IP coins is a serious path for a brand to go viral and you can profit a lot from this trend if you do it right. Except, it's also a very difficult path. MemeStrategy as an OG in the space and as an advisor could show people how to do it. Sign a deal, and they help your brand enter the Web3 space.

d. The strategy that links all products together

Memeland and 9gag have been launching products here and there. Recently all the memeland related accounts started posting again and Memeland started making moves. You can see this Memeland Giphy account with 1,400 GIFs and 46.6M views which was started recently. For reference, as of 04/10/2025 Pudgy Penguins have 27,300 GIFs for 60B views.

@9gagceo announced Potatoz as the main mascott of 9gag and the bridge from 9gag to Memeland, it might be the time where they link everything together.

What does the path look like and could it bring value to $meme ? Let's dig into that.

You would have:

• the Potatoz IP in the role of Pudgy Penguin

• 9gag uses their 200M user base to spread the IP

• Onboard 9gag creators to web3 by financializing their memes on Moonit

• Teach the most degen people of your community to trade via Ace Trader

• Traders trade memes on Moonit

• Tell the remaining user base about $meme and how they can gain exposure to everything you're build if they don't want to trade

• Boostrap the economic flywheel via MemeStrategy

• Keep converting people via GIFs, brand awareness, 9gag, games, and everything else

• Congrats, you have your own brand at the scale of Pudgy Penguin

This is a caricature. Things are not that easy and we'll see what can go wrong (there are plenty).

III. Bull and bear cases

IV. What is the best buy ?

So we have:

• Potatoz, Captainz, MVP NFTs

• $MEME

• Memeland and moonit memes ($pain, $jugs, ...)

Quick note, $pain is the token of Harold the Pain, one of the favourite meme of Ray Chan (CA: 1Qf8gESP4i6CFNWerUSDdLKJ9U1LpqTYvjJ2MM4pain). $pain was incubated by Memeland, not launched by them. You can buy it if you think MemeStrategy will interact with it. It's a great memecoin but between the two, $meme is the safest bet.

The best trade comes down to Potatoz or $meme in my opinion. Memeland didn't say anything about Captainz yet. They'll have value in the ecosystem but it's too speculative. $meme on the other hand has the most chances to get value from MemeStrategy and Memeland products because it's the only token. So if anything, I would buy $meme.

$meme marketcap is at 140M$ right now (170M$ FDV). ATH for circulating marketcap is at 600M$ according to coingecko. If we come back to these levels this is a 4x at 0.001$. 600M$ is reasonnable in my opinion. You can always sell around 500-550M$ marketcap. And if you're really bullish you can aim for 1B$ circulating marketcap which would be 50% of Pudgy Penguins.

Conclusion

We are seeing memecoins evolve. They are not the simple tokens we used to see. Now they are brands and IPs building culture around their memes and bringing value to their community and to the world. This is a very important evolution of the memecoin category.

Memeland aims to reproduce a similar path to Pudgy Penguins but with few differences. The competition in IP is still very small and there's room for more competition. Memeland aims to onboard meme creators to blockchain as well as the IP enjoyors and they seem to have a fair shot. They have a suite of products that acts as a funnel that goes deeper and deeper into their web3 world. From a cute IP to teaching them the trading trenches. This is a full conversion. They already have access to a 200M user base that creates and consumes memes and could use their products in many ways.

Tell me in the comments what you think about $meme and Memeland. Let's discuss!