MegaETH Valuation Game: A Good Entry Opportunity or Approaching Risk?

Is this a good entry opportunity?

Written by: KarenZ, Foresight News

MegaETH, with its technological breakthrough of "real-time blockchain" and a community-driven ecological philosophy, has become a focal project in the crypto market.

While the Ethereum ecosystem is still struggling with performance bottlenecks, MegaETH is reshaping the boundaries of imagination for the Layer2 track with its technical declaration of "100,000 TPS + millisecond latency".

From the early seed round investment by Vitalik, to the lightning fundraising by the Echo community, and then to the NFT sale at the beginning of this year, every step of MegaETH has stirred the nerves of the market.

Now, this project, which has received a bet from Vitalik Buterin, is about to launch a public sale on the Sonar platform. Is this a rare entry opportunity for ordinary investors, or the last baton of risk accumulation?

This article will analyze the financing context, valuation logic, core value, and potential risks.

MegaETH Financing Journey: From VC and Vitalik Endorsement to Community Building

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

In June 2024, MegaETH announced the completion of a $20 million seed round, led by Dragonfly, with participation from Figment Capital, Robot Ventures, Big Brain Holdings, and 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), among others.

By December 2024, MegaETH raised $10 million in less than three minutes through Cobie's Echo platform, far exceeding the set target of $4.2 million. This round attracted about 3,200 investors from 94 countries, with an average investment of $3,140 per person.

At the time, MegaETH co-founder Shuyao Kong told The Block that both the seed round and Echo round used a structure of equity plus token warrants, with both rounds valued at "nine figures", meaning the FDV was at least $100 million.

Unexpectedly for the community, in February this year, MegaETH launched the "The Fluffle" NFT series for innovative fundraising, further expanding its community base. This series of 10,000 NFTs are all non-transferable SBTs (Soulbound Tokens), sold via whitelist at a price of 1 ETH. Holders are entitled to at least 5% of future token allocations, with 50% unlocked on TGE day and the remaining gradually unlocked over six months.

This NFT issuance was divided into two phases. The first phase (5,000 NFTs) was retrospective, targeting those actively involved in the crypto industry (from supporting key protocols to leading local communities), with a small portion allocated to influential early believers in the MegaETH community and various strategic partners, some of which were distributed as free mints. One week after launch, MegaETH announced the completion of the first phase NFT issuance.

According to MegaETH's previous plans, the second phase of NFT issuance would be launched a few months after the first, aiming to provide similar participation opportunities to users who continue to drive influential social and on-chain interactions for MegaETH. The difference in this round is that quotas will be allocated to MegaETH's flagship accelerator program "Mega Mafia". Each team will receive a portion of the quota to distribute within their own 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 successfully complete identity verification on the Sonar platform and will use USDT on the Ethereum mainnet as the payment method. An English auction may be adopted, with a fixed maximum price cap. Choosing a one-year lock-up period will enjoy a 10% discount on the final token price. All US participants must lock up.

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

MegaETH's valuation evolution is closely tied to its financing history, market expectations, technological progress, distribution mechanism, and ecosystem.

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

As mentioned above, MegaETH's FDV in the $20 million seed round in June 2024 and the $10 million Echo round in December 2024 were both nine figures.

In the first phase of NFT issuance in February this year, according to a screenshot posted by then-OpenSea CMO Adam Hollander, MegaETH raised 4,964 ETH in the first phase, worth $13.29 million at the time.

According to my calculations, this $13.29 million represents at least 2.5% of the token allocation rights, which means that based on the NFT fundraising, MegaETH's FDV at that time was around $540 million.

Polymarket Forecast: 86% Probability of Hitting $2 Billion FDV

On Polymarket's prediction market for "MegaETH's FDV after the first day of listing", the probability of FDV exceeding $2 billion is 86%, the probability of exceeding $4 billion is 57%, and the probability of exceeding $6 billion is 21%.

This means that if MegaETH's FDV reaches $2 billion, the first batch of NFT holders will see a 3.7x return (in USD terms), while seed and Echo round participants will have even greater profit potential.

Platform Effect: The "Profit Effect" of Sonar's First Project

The Sonar platform (a platform under Echo founded by Cobie), where this community sale is taking place, comes with its own traffic halo. Its first fundraising project, Plasma, performed brilliantly—on the fourth day after TGE, it peaked at 34 times the sale price ($0.05), and is still maintaining a 9x increase. This platform effect has further raised market expectations for MegaETH's valuation.

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

MegaETH's continued favor from capital and the community stems from its differentiated competitiveness in technological innovation, distribution mechanism, and ecosystem building.

On the technical side, addressing common issues in current L2s such as second-level latency and insufficient throughput, MegaETH significantly improves Ethereum's scalability by optimizing the execution environment and node architecture, while maintaining full EVM compatibility, directly targeting the core needs of high-frequency trading, real-time on-chain gaming, and other Web3 applications.

In terms of distribution mechanism, MegaETH's approach is largely community-oriented, from the seed round, to the elite community-only fundraising platform Echo, to NFT sales targeting deeply involved crypto industry participants, and the upcoming public sale on Sonar, avoiding the monopoly of shares by institutions seen in traditional fundraising.

It is worth emphasizing that MegaETH's "The Fluffle" SBT series also abandons tradability, with token release following a "TGE 50% + 6 months linear unlock" model. At the start of unlocking, the release of token rewards for holders is linked to the depth of network interaction, encouraging real user participation through a dynamic evolution mechanism.

On the ecosystem side, MegaETH is expanding step by step through its accelerator program MegaMafia, flagship builder hub MegaForge, and stablecoin MegaUSD. Its testnet has already attracted multiple application deployments, covering DeFi, social, gaming, AI, and more. Some featured applications include DEX GTE, stablecoin engine CAP, real-time perpetual contract platform Valhalla, and trend trading platform NOISE.

Risk Warning

Despite its highlights, MegaETH still faces multiple challenges. In comparison, the current mainstream Layer2 valuations have set a market benchmark: Arbitrum FDV is $3.2 billion, OP FDV is $2 billion, Starknet FDV is $1.2 billion, and Zksync FDV is $800 million. Against this backdrop, whether MegaETH can break through a $2 billion FDV remains uncertain.

As an early-stage project, MegaETH also faces risks in technical implementation and overall market volatility. Investors should remain rational, wait for the detailed sale terms to be announced, and make prudent decisions based on specific pricing, FDV, and tokenomics. DYOR.

Recommended reading: "What exactly is the MegaETH that became a sensation overnight with Vitalik's favor?"