Fogo's strategic pivot! $20 million presale canceled, switched to airdrop sparking controversy

Built on the Solana virtual machine, the experimental Layer 1 blockchain Fogo suddenly announced the cancellation of its original $20 million token presale, opting instead for an airdrop to early users. Fogo co-founder Robert Sagurton stated that this strategic shift aims to better distribute tokens and reward early users. The original presale plan was to sell 2% of FOGO tokens at a fully diluted valuation of $1 billion, raising $20 million. Now, this 2% allocation will be entirely airdropped.

48 Hours from Presale to Airdrop: A Rapid Turnaround

Fogo’s strategic shift came very suddenly. Earlier this week, Fogo announced the launch of a $20 million token presale, planning to sell 2% of the total supply of FOGO tokens at a fully diluted valuation of $1 billion. The initial intent was to broadly distribute tokens among existing users and loyal fans, with a relatively small fundraising effort prioritizing token delivery over capital raising.

However, in less than 48 hours, Fogo Foundation Director Robert Sagurton announced the cancellation of the presale. In a private message to The Block, he explained: “The initial goal of the presale was to broadly distribute tokens to existing users and loyal fans, but we believe there are better ways to achieve that while focusing on the public mainnet launch.” This change means that the 2% of tokens that would have been purchased with money will now be airdropped for free to eligible early users.

Sagurton’s explanation reveals the core logic behind the team’s decision: “Always observe the situation, test whether the initial assumptions are reasonable, and when they’re no longer valid, don’t hesitate — pivot decisively.” Such rapid strategic adjustments are uncommon in crypto projects; most stick to original plans to maintain market confidence, but Fogo chose a more aggressive approach.

Former Jump Crypto executive Sagurton indicated that canceling the token sale represents “a doubling down on Flames,” and that this strategic shift will not affect the launch schedule of Layer 1 on January 13. This suggests the team believes a points system can better incentivize the early community than a presale, and whether this judgment proves correct will be tested after the mainnet launches.

Point Holders Become the Biggest Winners

The immediate beneficiaries of Fogo’s strategic change are points holders. Since the original presale scheduled for December 17 was canceled, Fogo points holders may receive more allocation. The Fogo team stated on X: “We have compiled information on Fogo Fishers, Portal Bridge points holders, and all USDC transfer users since the initial presale announcement. We will allocate Fogo Flames points to these users.”

These groups include early users of the Fogo testnet, users of the Fogo Fishing dApp, and users who bridged USDC to Fogo via Wormhole before the snapshot deadline. Fogo Flames is a points system that can be exchanged for FOGO tokens after the mainnet launches on January 13. The 2% of tokens initially requiring payment in the presale will now be distributed via the points system, meaning early participants not only save funds but may also receive more tokens.

Three Main Beneficiary Groups in the Fogo Airdrop

Fogo Fishers: Early users of the Fogo Fishing dApp on the testnet, with accumulated interaction data

Portal Bridge Users: Users who bridged USDC to Fogo via Wormhole before the snapshot, demonstrating actual usage intent

USDC Transfer Users: Users who transferred USDC since the presale announcement, including potential buyers preparing to participate in the presale

Fogo stated: “We greatly appreciate everyone’s strong support. Rest assured, we have taken note of this. The Fogo Flames points program remains a core pillar of our reward system for developers, community members, and ecosystem participants.” This statement indicates the team views the points system as a more effective community incentive tool than the presale.

38.98% Unlock Sparks Controversy and Token Distribution

Fogo’s tokenomics, announced last week, drew market attention. 6.6% of tokens will be airdropped and immediately tradable after the mainnet launch, with about one-third of the initial FOGO supply unlocked to fund the Fogo Foundation. Core contributors will receive 34% of tokens, distributed over four years. A total of 38.98% of tokens will unlock on January 13, coinciding with the mainnet launch, a much higher initial unlock percentage than most new projects.

The project designated two institutional investors: Distributed Global and CMS Holdings, which will receive a combined 8.77% of total tokens. Advisors will also receive a 7% reward. Besides the airdrop, 11.25% of the FOGO supply is allocated to “community ownership,” including investments from two fundraising rounds conducted on Echo (a platform founded by well-known crypto trader Jordan Fish), and the canceled Metaplex sale.

The team wrote on X on Thursday: “Echo and the upcoming Metaplex sale ensure that community members hold more shares than institutional investors.” The Echo sale alone involved about 3,200 investors, including raising $8 million at a $100 million valuation in January. Additionally, before the canceled presale, Fogo burned 2% of the initial Genesis token supply reserved for core contributors. A Fogo representative stated: “These tokens are now gone forever.”

Fogo is built on the Solana blockchain framework, developed by former Wall Street executives, aiming for 40-millisecond block times, supporting instant transactions, and reducing malicious MEV trades. Its testnet launched in July, currently processing over 1,000 transactions per second. Notably, Fogo plans to be the first blockchain to implement Jump Crypto’s validator client software.