- MegaETH oversubscribed its $50 million token sale.
- The project will look at crypto transactions and social media activity to determine allocations.
Investors are scrambling to get in on MegaETH’s red-hot token sale.
The Ethereum compatible blockchain opened bidding for $50 million worth of MEGA tokens at 1pm London time on Monday. But the sale’s popularity vastly exceeded expectations.
Now the project’s developers are faced with a tricky situation. They must decide which of the 11,534 wallets that have pledged over $300 million funds will receive a share of the tokens on offer.
“If oversubscription happens, a special allocation mechanism will be used,” MegaETH said in the terms of the token sale.
The project will look at bidder profile information, such as their social media, GitHub, and wallet addresses, that demonstrates past engagement in the MegaETH and Ethereum communities to determine allocations.
There’s a lot on the line for bidders. Whoever MegaETH picks to receive a share of the tokens will likely see a huge return on their investment.
Risky bets
The sale comes amid soaring demand for early stage crypto investments.
While risky — even by crypto standards — several high-profile investments in startups such as Bitfinex’s Plasma blockchain have returned multiples for early investors. The excitement is driving demand as other investors attempt to replicate their success.
It’s not clear what criteria MegaETH will look at when determining past engagement among bidders. The project previously used community interaction on social media to allocate a set of NFTs which guarantee holders an airdrop of MEGA tokens.
Additionally, those who choose to lock-up their tokens for a year when bidding for MEGA tokens may also help them secure an allocation, MegaETH said.
Oversubscribed
MegaETH’s token sale let bidders decide how much they wanted to pay between $0.0001-$0.0999, with higher bids receiving tokens first.
However, bids quickly hit the token’s maximum purchase price as bidders bet on its future growth.
The token already trades on futures markets at a $4.3 billion valuation. So anyone who gets to buy the token in the sale’s $1 billion valuation will instantly see a more than 300% paper gain.
Despite the excitement, MegaETH is yet to reveal what function its MEGA token will serve. The project said it could be used to power the blockchain’s economic systems or as a store of value.
It’s not the first opportunity investors have had to get their hands on MegaETH tokens.
The project raised $10 million in December selling equity plus token warrants to investors on Echo, an early-stage crypto investment platform.
At the MEGA token’s $4.3 billion futures market valuation, those investors have made a 22-fold return so far.
Tim Craig is DL News’ Edinburgh-based DeFi Correspondent. Reach out with tips at tim@dlnews.com.