MegaETH ICO Allocations Leave Community Split

Ethereum Layer 2 blockchain MegaETH unveiled token allocations to its initial coin offering (ICO) participants today, and while most investors expected small allocations, some feel slighted.

MegaETH concluded its initial coin offering (ICO) on Oct. 30, with nearly $1.4 billion in commitments competing for a slice of the $50 million MEGA allocation, resulting in a 28x oversubscription. Allocations were distributed based on a mix of criteria, including social and onchain scores, as explained in an article by MegaETH contributor and chief security officer Namik Muduroglu.

Considering the large number of participants, MegaETH whittled ICO contributors down to two categories: community and public. Those who are considered part of the community, as well as MegaETH builders, received preferential distributions due to their perceived long-term alignment. However, the exact criteria for this community allocation remain unclear, and some users who minted multiple Fluffle NFTs and/or contributed to the MegaETH Echo round were not included.

“It is not perfect. We definitely missed people, and for that I am genuinely sorry,” said Muduroglu.

The team also clarified that some in the community category received minimum allocations, while some members of the public received larger distributions, but the methodology enabled the team to maintain control over the average allocation per wallet.

As a result, community members were prioritized over the public, and those who chose to lock their tokens for a year were also prioritized over unlocked bidders, giving them an average allocation of $75,000.

Crypto content creator TylerD called the ICO process “misleading” on X today as he said, “I like MegaETH. I do not like this public ICO allocation methodology, and don’t understand why it’s being praised.”

“[A] wallet with onchain history, fluffle and early megaeth testnet activity with max bid (unlocked) got min allo. If that wallet gets the same as a fresh wallet, then just give everyone who unlocks the min bid and say you have to lock to get more,” Tyler added.

Upon the conclusion of the sale, MegaETH contributor Bread reminded users who got minimum allocations that it’s not over yet.

“We’re still nuking sybils who got through. People will cancel their bid. That $MEGA will go to the remainder of the pool, so people who belonged and showed conviction can get more,” he posted.