Ethereum Layer 2 network MegaETH’s initial coin offering reportedly “sold out” within minutes and is currently oversubscribed by around $400 million as users scramble to get their allotment of MEGA tokens.
Ethereum’s Layer 2 network began auctioning MEGA tokens on Monday with a raising limit of just under $50 million, but the auction subsequently saw more than $450 million traded in just a few hours.
In total, the Initial Coin Offering (ICO) will allocate 5% of the total 10 billion token supply, with a maximum bid of $186,282 and a minimum bid of $2,650, with the option to select a 1-year lock-up at a 10% discount.
According to the auction FAQ, due to oversubscription, once the countdown timer expires after two days, a “special allocation mechanism” will be used to determine each user’s allocation, taking into account their past involvement in the MegaETH and Ethereum communities and whether a lockup was selected.
The project’s white paper lists the token launch date as January 2026. The token will be tradable on certain centralized and decentralized exchanges operated by MegaETH, and will function not only as a standard ERC-20 token, but also as an “economic engine for a pair of new infrastructure features, including sequencer rotation and proximity markets.”
MegaETH token sale surge: guilty verdict or FOMO?
According to a report on X, blockchain analytics platform Arcam said the token was oversubscribed within minutes and had already reached five times its cap in just two hours, with 819 addresses reaching the maximum bid.
“Such aggressive simultaneous purchases could be a red flag,” Brian Q, an analyst at on-chain analytics platform Santiment, said on Tuesday.
“If too many participants move in the same direction at once, it amplifies speculative pressure and increases the risk of a sharp reversal, which could reflect social momentum rather than fundamentals,” he said.
“The large amount of maximum contributions in such a short period of time raises the question: Are buyers driven by long-term confidence in MegaETH’s technology or by fear of missing out (FOMO)?”
MegaETH promise could also be a factor
But he also said it could be driven by the project’s high promise. The creators of MegaETH, known as MegaLabs, have raised significant funding and are backed by some of the most influential figures in the industry, including Ethereum co-founders Vitalik Buterin and Joe Lubin.
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The project aims to achieve 100,000 transactions per second and sub-millisecond latency following the testnet launch in March.
“At the end of the day, the reason MegaETH is getting so much hype is because it promises what everyone in the crypto industry wants: a blockchain that is as fast and smooth as a regular app, but connects to Ethereum’s trusted network,” said Brian Q.
“If the team can achieve its goals, this could be one of the most useful Ethereum extensions ever. However, like all early-stage crypto projects, this is still in the experimental phase. Therefore, traders and investors should remain curious rather than careless as the story unfolds.”
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