CryptoPunks Under Fire: Taxes and Massive Drops

A recent scandal has rocked the CryptoPunks community. Waylon Wilcox, a Pennsylvania investor, admitted to dodging $3.3 million in taxes

The top-tier NFT collection of the blockchain, CryptoPunks, has recently faced a trust loss from investors after a tax evasion bust. It occurred after many scandals these days, from jaw-dropping price swings to million-dollar missteps. But beyond the headlines, the NFT market in 2025 remains a battleground of risk and reward.

CryptoPunks' investors are used to seeing big numbers—and lately, they've been seeing red. A recent scandal has rocked the community.

A Pennsylvania investor, Waylon Wilcox, admitted to dodging $3.3 million in taxes on $13 million in profits from selling 97 CryptoPunks between 2021 and 2022. This guilty plea marks the first U.S. criminal case linking NFTs to tax evasion, signaling tighter scrutiny of digital asset gains. Wilcox now faces up to six years in prison—a stark warning to investors navigating the murky waters of crypto wealth.

Yet, not every transaction spells success.

CryptoPunk #3100, a rare Alien Punk, sold for 4,000 ETH ($6 million) in April 2025. This move witnessed a $10 million loss from its $16 million purchase (4,500 ETH) a year earlier. The drop reflects a 57% decline in ETH’s value, costing the seller 500 ETH and millions in USD. Facilitated by Fountain, the transaction likely involved a major investor, as the buyer’s wallet received funds from a Coinbase Prime address.

Despite Alien Punks’ dominance in high-value sales, CryptoPunks’ floor price fell 44% to $65,373, signaling a steep decline from their 2021 peak. Such swings highlight the fine line between fortune and failure in the NFT space.

The narrative around NFTs in 2025 blends caution with opportunity. While scandals and losses are discussed openly, some investors are quietly amassing wealth through strategic moves. A standout case from the first quarter of 2025 illustrates how quickly fortunes can turn in the unpredictable domain of NFTs.

Consider the Pudgy Penguins, a collection that has risen to prominence through clever branding and community buzz. In January 2025, an investor purchased a rare Pudgy Penguin for 15 ETH—equivalent to $24,000 at the time. By April, that same NFT sold for 50 ETH, delivering an $80,000 profit in three months.

The surge stemmed from Pudgy Penguins’ savvy marketing endeavors. They launched exclusive merchandise lines in collaboration with a lifestyle brand, catering to the community’s preferences. Moreover, Pudgy Penguins' limited-edition sneakers with a major footwear company drove up the collection's cultural cachet, leading to a viral TikTok campaign that snowballed into mainstream attention.

A comparable case of NFT collection performance in 2025 involves the Doodles collection, It saw a remarkable gain driven by strategic partnerships and community engagement. In February 2025, an investor acquired a rare Doodle NFT for 10 ETH, approximately $18,000 at the time. By April, the same NFT sold for 35 ETH, yielding a $45,000 profit in two months.

The surge was fueled by Doodles’ collaboration with a major fashion brand for limited-edition apparel and a viral augmented reality campaign on social media, ultimately enhancing the collection's mainstream appeal.

In contrast to CryptoPunks' turbulent ride, these cases demonstrate how smaller, community-driven collections can offer steady gains for those who spot potential early. This success reflects broader trends in the NFT market. Solana-based projects are gaining traction, while Ethereum giants like CryptoPunks maintain their allure.