MegaETH acquires 4.75% of its capital and token warrants from its early investors, a rare operation approved by Dragonfly and Echo.
Strategic Move Before the Big Leap
This buyback comes just weeks before the launch of the MegaETH mainnet and token. The team aims to ‘clean up’ its capital before entering the public market, ensuring that only truly committed stakeholders remain onboard.
According to co-founder Shuyao Kong, the transaction was valued higher than the seed round, which raised $20 million for a nine-figure valuation, meaning at least $100 million. This highlights MegaETH as not just a promising project but already a significant enterprise.
Some outgoing investors didn’t choose to leave voluntarily:
Some of our investors closed their funds and were looking to liquidate all their positions. Since we do not allow secondary sales, the MegaETH team was their only possible buyer.
‘Aligning Holders, Not Stacking Capital’
The operation aligns with a clear philosophy: building a long-term project rather than a speculative asset. ‘From day one, we’ve favored investors and aligned builders over transient capital,’ claims Kong.
When an opportunity arises, we prefer to take parts off the market rather than see them circulating in the shadows. This keeps our cap table clean and our mission clear.
This approach contrasts with past cycles where decentralized projects faced pressure from venture funds eager to sell their allocations before token launches.
A Highly Engaged Community
MegaETH has already made waves with its rapid crowdfunding rounds. Last December, Echo, founded by renowned trader Cobie, allowed the community to invest $10 million in less than three minutes, at the same valuation as the seed round. Shortly after, the ‘The Fluffle’ NFT collection sale generated over $13 million through non-transferable ‘soulbound’ NFTs.
Next Stop: Public Token Sale
The next major milestone is the public token sale, set to take place via Cobie’s Sonar platform. Registrations are open until October 27, with the targeted amount remaining confidential.
MegaETH is in the final stages of its testnet. The mainnet launch and token generation will follow suit. If the promise of a Layer 2 capable of ‘real-time’ transactions holds true, MegaETH could disrupt the established order by Arbitrum, Base, and Optimism, emerging as the new leader in scaling Ethereum.
