megaETH NFT Sale Sparks Controversy: Community Giveback or Cash Grab Opportunity?
Original Title: "Controversial megaETH Retro ICO: Giving Back to the Community or Prepping for an Early Exit?"
Original Author: Golem, Odaily Planet Daily
megaETH, a real-time blockchain focused on enhancing Ethereum's performance, today announced the upcoming launch of a new NFT series: The Fluffle. The total supply of this NFT series is 10,000, with whitelist pricing set at 1 ETH. These are non-tradable and non-transferable SBTs (Soul-Bound Tokens). NFT holders are entitled to 5% of future token allocations, with 50% unlockable on TGE day and the remainder vesting linearly over 6 months. While whitelist details have not been disclosed, users can currently check their whitelist eligibility on the official website.
megaETH is one of the current hot Ethereum scalability solutions. On June 27, 2024, it completed a $20 million seed round, with funding from institutions and figures like Dragonfly, Robot Ventures, Folius Ventures, and Vitalik Buterin. In December 2024, it conducted a community round on the Echo platform, reaching its $10 million fundraising target within 3 minutes, with a valuation exceeding $2 billion.
However, the NFT sale event introduced by megaETH this time has sparked intense controversy in the community. On one hand, some players believe the fundraising odds are excessively high, and there has been active whitelisting off-exchange. On the other hand, some players question whether megaETH's actions amount to a disguised ICO and whether it is seizing the community's gains before the bull market ends. So, who is more reasonable? Odaily Planet Daily will outline both perspectives in this article for readers' reference, without providing any investment advice.
Affirmative: Valuation is Reasonable, Worth Participating
Undoubtedly, the highlight of megaETH's The Fluffle NFT series is the 5% future token airdrop distribution. Therefore, the community generally views this as a "backdoor token sale" activity. With a successful sale, the project team receives 10,000 ETH, currently around $27 million (assuming ETH prices remain stable). If we calculate the token's FDV based on the 5% airdrop rate, it amounts to $5.4 billion.
In addition to the previously received $30 million in funding, megaETH's total funding amount is $57 million. Calculating the FDV of megaETH at 20 times the funding amount, the project's FDV is only $1.14 billion.
However, whether it is based on the $540 million FDV calculated using NFT pricing or the $1.14 billion FDV estimated based on the funding amount, the community players supporting megaETH believe that the valuation is still within a reasonable range and has at least a 10x potential upside. After all, compared to the previously hot Ethereum scaling solutions' FDVs, such as ZKsync ($4.2 billion), Starknet ($19.5 billion), and Blast ($2.7 billion) during the TEG era, megaETH's current FDV is indeed not high, and even still below Starknet's current $660 million circulating market cap.
ABCDE Venture co-founder BMAN expressed support for megaETH: "They could have raised more funds but turned down a $1 billion VC offer, choosing to use the retro ICO approach and distribute tokens to a larger community. I believe this is an attractive opportunity for liquidity, and it is also the most asymmetric opportunity recently. As an investor, I am pleased to see Ethereum return to the simple, retro ICO era."
NFT project CyberKongz's team member enzoblue even boldly stated that if anyone does not want the whitelist, feel free to DM.
Some community players have also seen through the reasons behind megaETH's "shell listing." On one hand, using SBT can avoid speculation in the NFT secondary market; on the other hand, clearly defining NFT as a "collectible" reasonably mitigates legal risks and allows the community to access the nearly equivalent private placement price compared to VCs in NFT form. megaETH co-founder CakeBrother was straightforward when faced with community doubts, saying, "We cannot directly ICO tokens to the community; we can only lower the valuation in this way and give it to the community in NFT form. Whether people buy it or not depends on their own valuation of the project."
Counterpoint: No mainnet launch, early harvesting
Of course, in this circle where truth and falsehood are mixed, and innocence relies entirely on eloquence, many times understanding a project's true intentions cannot rely solely on what they say. Therefore, some community players have raised doubts about megaETH, believing that in the current market environment, the $540 million valuation is still too high, and the project team's coin sale before launching the mainnet is an attempt to capitalize on the bull market and liquidity abundance for early harvesting.
During this cycle, there is a prevalent phenomenon in the market where project teams see coin issuance/listing as the finish line, with numerous projects ceasing operations even after profiting from the coin issuance, sometimes directly halting operations behind the scenes, only hoping for the tokens to unlock as soon as possible. With lessons learned from past experiences, megaETH's ICO-like event happening before the mainnet launch raises concerns. With the real product yet to be launched, will there be the drive to continue future development once the funds are secured? Does the product justify the current valuation? These questions are inevitably worrying because, ultimately, in the current imperfect regulatory environment, the highest constraint on Web3 project teams is their own moral standards. Is it Build first or money first?
In the Chinese-speaking community, a Key Opinion Leader (KOL) extensively questioned megaETH's recent NFT sale event in a lengthy article. The KOL expressed that MegaETH does not genuinely care about community experience. If they did, they should distribute tokens through a fair mechanism such as game contribution, activity rewards, or even NFT staking. The project team seems to oppose a "meaningless airdrop point system" but in reality has just found an excuse to rationalize directly selling tokens.
Another KOL, Feng Wu Xiang, also published an article expressing concern about the future airdrop ratio of MegaETH. After all, Liver Emperors have never been able to surpass the big-spending whales throughout history. Feng Wu Xiang also mentioned that compared to Monad, which is still focusing on ecosystem development and ecological activities, MegaETH raised funds through an ICO and no longer needs a centralized exchange (CEX) to provide liquidity exit. This new paradigm may not necessarily be a good thing for the industry.
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