Original Title: "MegaETH Valuation Game: Opportunity or Approaching Risk?"

Original Author: KarenZ, Foresight News

MegaETH, built on the concept of "real-time blockchain" and community collaboration, has become a flagship project in the cryptocurrency market.

At a time when the Ethereum ecosystem is still grappling with performance bottlenecks, MegaETH has reshaped the imagination of the Layer 2 track with its "100,000 TPS + millisecond latency" technological manifesto.

From the early Vitalik-backed seed round funding to Echo community's lightning fundraising, and to this year's early NFT sale, every step of MegaETH has stirred the market's nerves.

Now, this project, backed by Vitalik Buterin, is about to kick off its public sale on the Sonar platform. Is this a rare entry opportunity for ordinary investors, or is it the final blow of accumulated risk?

This article will dissect the funding context, valuation logic, core value, and potential risks.

MegaETH Funding Journey: From VC, Vitalik Endorsement to Community Building

As an Ethereum L2 project committed to achieving "real-time blockchain," MegaETH's funding journey showcases an evolution from VC funding to community-driven sales.

In June 2024, MegaETH announced the completion of a $20 million seed round funding, led by Dragonfly with participation from Figment Capital, Robot Ventures, Big Brain Holdings, among others. Angel investors included Vitalik Buterin, ConsenSys founder and CEO Joseph Lubin, EigenLayer founder and CEO Sreeram Kannan, ETHGlobal co-founder Kartik Talwar, Helius Labs co-founder and CEO Mert Mumtaz, Hasu, and Jordan Fish (aka Cobie).

Fast forward to December 2024, MegaETH raised $10 million in under three minutes through Cobie's Echo platform, far exceeding the target of $4.2 million. This funding round attracted around 3,200 investors from 94 countries, with an average investment amount of $3,140 per investor.

At that time, MegaETH co-founder Shuyao Kong told The Block that both the seed round financing and Echo round financing adopted a structure of equity plus token subscription warrants, with valuations for both rounds in the "nine figures" range, meaning a minimum FDV of $100 million.

To the community's surprise, in February of this year, MegaETH launched "The Fluffle" series NFT for an innovative financing, further expanding its community base. The series of 10,000 NFTs are all non-transferable SBTs (Soul-Bound Tokens) sold in whitelist form at a price of 1 ETH, with holders collectively receiving at least 5% of future token distribution rights. 50% of the tokens unlock on TGE day, with the remaining unlocking gradually over 6 months.

This NFT issuance is divided into 2 stages. The first stage (5000 NFTs) is the retrospective stage, targeting those actively involved in the Crypto industry (from supporting key protocols to leading local communities), with a small portion allocated to influential early MegaETH community believers and various strategic partners, some of which were distributed in the form of free minting. A week after launch, MegaETH announced the completion of the first stage of the NFT issuance.

According to MegaETH's previous plan, a few months after the first stage NFT issuance, the second stage NFT will be discovered, aiming to provide a similar participation opportunity for those continuously driving influential social and on-chain interactions for MegaETH. The difference in this round is that quotas will be allocated to the MegaETH flagship accelerator program "Mega Mafia." Each team will receive a portion of the quota to distribute to their respective communities. A small portion of the quota in this round will be reserved for ordinary users through social media analysis.

According to the MegaETH website, the latest community sale is open to all users who have successfully completed identity verification on the Sonar platform, and will use USDT on the Ethereum mainnet as the payment method, possibly through an English auction, with a fixed maximum price. Opting for a 1-year lockup period entitles a 10% discount on the final token price. All U.S. participants must undergo KYC.

Valuation Logic: Historical Pricing, Market Expectations, and Core Value

MegaETH's valuation evolution is closely linked to its financing journey, market expectations, technological progress, distribution mechanisms, and ecosystem.

Historical Financing Valuation: Soaring from $100 Million to $540 Million

As mentioned earlier, MegaETH's valuations for the $20 million seed round financing in June 2024 and $10 million Echo round financing in December 2024 were both in the nine-figure range.

And in the first stage NFT issuance in February of this year, according to a screenshot published by Adam Hollander, Chief Marketing Officer of OpenSea at the time, MegaETH raised 4964 ETH in the first stage NFT issuance, worth $13.29 million at the time.

By my calculation, this $13.29 million represents at least 2.5% of the token distribution authority, and it can be calculated that based on the NFT fundraising situation, MegaETH's FDV at that time was around $540 million.

Polymarket Market Prediction: 86% Probability of Impacting $2 Billion FDV

In the Polymarket market prediction related to "MegaETH's FDV after the first day of trading," the probability of betting on an FDV greater than $2 billion is 86%, the probability of betting on an FDV greater than $4 billion is 57%, and the probability of betting on an FDV greater than $6 billion is 21%.

This means that if MegaETH's FDV reaches $2 billion, the return multiple for the first batch of NFT holders would be 3.7x (in USD terms), with even more significant returns for seed round and Echo round participants.

Platform Effect Endorsement: The "Money-Making Effect" of Sonar's Initial Project

The community sale on the Sonar platform (an Echo-backed platform founded by Cobie) comes with a built-in traffic halo, and its initial fundraising project, Plasma, has performed remarkably well—achieving a peak of 34x the sale price ($0.05) on the fourth day post-TGE and still maintaining a 9x increase. This platform effect has further heightened the market's valuation expectations for MegaETH.

Core Value: The Triple Moat of Technology, Mechanism, and Ecosystem

MegaETH's ability to continue to receive capital and community favor stems from its differentiated competitive advantage in technological innovation, distribution mechanism, and ecosystem development.

On the technological front, addressing common issues in existing L2 solutions such as sub-second latency and insufficient throughput, MegaETH has significantly improved Ethereum's scalability by optimizing the execution environment and node architecture while maintaining full compatibility with the EVM, directly addressing core needs of high-frequency trading, real-time chain games, and other Web 3 applications.

In terms of the distribution mechanism, MegaETH's mechanism has largely adhered to a community-oriented approach—from seed round funding, to the elite community-exclusive fundraising platform Echo, to NFT sales targeting deep participants in the Crypto industry, and the upcoming ICO on Sonar, a more equitable public token sale platform on Echo, avoiding the institutional monopoly on shares seen in traditional fundraising.

It is worth emphasizing that the "The Fluffle" series SBT issued by MegaETH also abandons the tradability attribute. The token release adopts the "TGE 50% + 6 months linear unlock" model. At the start of the unlock, the holder's token rewards release is deeply tied to network interaction, encouraging genuine user participation through a dynamic evolution mechanism.

In terms of ecosystem development, MegaETH is gradually unfolding through the accelerator plan MegaMafia, the flagship builder hub MegaForge, and the stablecoin MegaUSD. The testnet has attracted multiple application deployments covering various fields such as DeFi, social, gaming, AI, among others. Some selected applications include the DEX GTE, the stablecoin engine CAP, the real-time perpetual contract platform Valhalla, the trend trading platform NOISE, etc.

Risk Warning

Despite its prominent highlights, MegaETH still faces multiple challenges. In a horizontal comparison, the current mainstream Layer 2 valuations have set a reference benchmark for the market, with Arbitrum FDV at $3.2 billion, OP FDV at $2 billion, Starknet FDV at $1.2 billion, and Zksync FDV at $800 million. Against this backdrop, the uncertainty remains whether MegaETH can break through a $2 billion FDV.

As an early-stage project, MegaETH also faces risks such as technical implementation and overall market volatility. Investors need to maintain rational judgment and, after the detailed sales terms are announced, make prudent decisions based on specific pricing, FDV, and tokenomics. Do Your Own Research.

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