MegaETH is empowering bidders with valuation authority. The real-time blockchain announced it will auction 5% of its token supply on Oct. 27 via Echo’s Sonar platform, starting with a $1 million valuation and a cap under $1 billion.
Summary
- MegaETH will auction 5% of its MEGA token supply on Oct. 27 via Echo’s Sonar platform.
- The English auction is designed to curb inflated valuations and create a diverse base of non-insider investors.
- A “U-Shaped Allocation” system will follow for oversubscription, prioritizing verified contributors.
According to an announcement on Oct. 22, the project will utilize an English auction for the 5% portion of the MEGA token supply. This approach allows the market to find a clearing price, starting at a $1 million fully diluted valuation and ending at a $999 million cap.
The structure aims to avoid the excessive valuations that have affected previous token auctions, leading to losses for retail investors. MegaETH, which has already secured $30 million from supporters like Dragonfly, Vitalik Buterin, and 3,000 Echo users, intends to use this sale to build its core investor base, according to the blockchain’s team.
“This public sale will make non-insider investors the single largest stakeholder in the MegaETH network, larger than the VCs and the team,” the announcement stated.
A new model for community ownership
Should the Sonar auction experience significant interest, MegaETH plans a secondary phase for its mainnet launch. The project has committed to keeping an additional portion of tokens specifically for those involved in its previous funding rounds, including the Sonar, Echo, and Fluffle sales.
To address potential oversubscription, MegaETH will implement a “U-Shaped Allocation” system. This system prioritizes “depth” by granting larger allocations to participants who can prove their meaningful contributions to the growth of MegaETH or the broader Ethereum ecosystem.
Conversely, it ensures “breadth” by providing a baseline allocation to at least 5,000 participants, aiming to maximize the number of unique token holders from the start.
The project stated that priority will be given to wallets linked to accounts that have been longstanding advocates for MegaETH and Ethereum principles. MegaETH is also looking for what it describes as “chronically onchain” actors—addresses with a history of early and consistent engagement with pioneering smart contracts on Ethereum, ranging from early DeFi protocols like Compound and Uniswap to more recent restaking and DePin ecosystems.
Furthermore, MegaETH is considering cultural alignment alongside technical involvement. Ownership of specific NFT collections, such as MegaETH’s own Fluffles and other “cultural icons” from its ecosystem, is recognized as a valid indicator. The project also mentioned blue-chip NFTs like CryptoPunks and Art Blocks, indicating a strategy to attract collectors with established commitment to digital ownership.
