Author: Chloe, ChainCatcher
Layer 2 network MegaETH officially launched its public mainnet yesterday, and this project, which calls itself an "instant blockchain," has formally entered the practical stage. The project completed a $450 million token sale in October last year, with subscription amount reaching $1.39 billion, oversubscribed 27.8 times, and received endorsements from heavyweights such as Ethereum co-founder Vitalik Buterin and ConsenSys founder Joseph Lubin. However, the same year, the project subsequently experienced incidents of a certain crypto KOL's token allocation being revoked and an out-of-control pre-sale of project deposits. Nevertheless, the project team eventually quickly addressed and calmed the situation, preventing it from escalating into a larger crisis.
MegaETH aims to process 100,000 transactions per second (TPS), with a block time under 1 millisecond, and has consistently achieved 35,000 TPS in recent stress tests. However, Vitalik has recently become increasingly pessimistic about the current Layer 2 landscape. Despite MegaETH receiving significant capital support, whether it can stand out in the competitive L2 market still needs to be proven by actual performance.
What did MegaETH go through before its launch?
Despite being regarded as a performance dark horse, MegaETH has also experienced dramatic ups and downs over the past few months. From the fervor of public fundraising to refunds triggered by technical failures, the journey has not been smooth. In October last year, MegaETH launched a MEGA token auction, igniting market enthusiasm. The auction ultimately attracted 1.39 billion USD in subscription funds, with an oversubscription multiple as high as 27.8 times, becoming one of the most notable fundraising events of the year.
However, just ten days after the public offering ended, the crypto KOL IcoBeast was judged by the official to have violated the "no resale intent" rule of the one-year lock-up period for publicly discussing on the X platform how to hedge his $1 million allocation. Chief Strategy Officer Namik Muduroglu immediately canceled the allocation and returned the principal, and publicly stated clearly: MegaETH only welcomes "true believers" who recognize long-term value, and speculators have no place here.
At the end of the same year in November, MegaETH attempted to inject early liquidity into the upcoming mainnet through a pre-deposit bridge. However, the event turned into a chaotic disaster due to a series of technical failures: a misconfigured SaleUUID contract, a severely throttled KYC system, and a multisig transaction that was supposed to be a backup but was prematurely executed by a third party, causing the deposit channel to unexpectedly open and funds to surge past $500 million. Faced with the out-of-control situation, the team ultimately announced a full refund and temporarily closed the bridge, citing the execution as "hasty." Afterwards, the official statement said: "Assets were never at risk, but that doesn't matter. We hold ourselves to higher standards, and there are no excuses for this."
After a series of upheavals at the end of 2025, MegaETH has finally officially launched its mainnet.
MegaETH Sets Token Issuance KPIs, Abandons Traditional TGE Strategy
According to official statements, with the mainnet launch, MegaETH simultaneously introduces its ecosystem front-end platform The Rabbithole, offering features such as application exploration, asset bridging and exchange, and ecosystem event notifications. Additionally, MegaETH has adopted a token issuance strategy that is entirely different from traditional projects. The mainnet is now live, but the native token MEGA is temporarily not being issued.
According to the team's announced mechanism, the TGE must meet three strict KPI conditions:
1. Stablecoin Circulation Threshold: The native stablecoin USDM must maintain a 30-day average circulation of $500 million, which is equivalent to approximately $20 million in annual protocol revenue.
2. Ecological application deployment standard: At least 10 MegaMafia incubator projects that have undergone rigorous review must be fully deployed and operating normally.
3. Application Revenue Verification: At least 3 applications must generate $50,000 in revenue daily for 30 consecutive days, equivalent to a monthly ecosystem revenue of $45 million. This "build the ecosystem first, issue tokens later" model attempts to break the vicious cycle of the past where "mainnet launch equals airdrop, token unlock equals dumping."
MegaETH binds the token issuance rights with the actual ecological value creation, forcing the team to first prove the network's real demand and profit-making ability before launching the token economy. It can be said that this is a bold experiment against the traditional token issuance paradigm.
Overview of the MegaETH Ecosystem Projects and Their Funding Backgrounds
According to the ecosystem map on RootData, MegaETH has already given birth to many promising applications, including:
Noise: This project provides an alternative for prediction markets by allowing traders to bet on which topics will remain hot online in the long term. The platform combines elements of Google Trends and existing prediction markets to measure which brands, trends, and narratives have sustained cultural influence. In January of this year, Noise completed a $7.1 million funding round, led by Paradigm.
GTE: This decentralized exchange platform was incubated by MegaETH Labs and combines AMM with a centralized limit order book, aiming to bring CEX-level performance and liquidity to DeFi. The initial fundraising was completed in January last year with a total amount of 10 million US dollars, and the investor list includes institutions such as Maven11 and Wintermute. In June of the same year, GTE further completed a Series A round of 15 million US dollars, led by the top crypto venture capital firm Paradigm.
CAP: This project is a yield-bearing stablecoin protocol, which has completed three rounds of financing since the end of 2024, raising a total of 11 million USD. In April last year, the project announced two financing rounds on the same day: an 8 million USD seed round co-led by Franklin Templeton and Triton Capital XYZ, with over ten institutions including GSR and Flow Traders participating; a 1.1 million USD community round participated by MegaETH ecosystem projects, including GTE, echo, Euphoria Finance, etc. Recently, CAP's cUSD has been launched on the Ethereum mainnet, with TVL previously reaching as high as 200 million USD.
HelloTrade: This project is positioned as a chain-based derivatives platform with institutional-grade security, providing global 24/7 trading for stocks, commodities, and real-world assets, supporting mobile fast trading and leveraged perpetual futures. The project was co-founded by Wyatt Raich and Kevin Tang, two former leaders of BlackRock's crypto business, and completed a $4.6 million funding round in November last year, led by Dragonfly.
Euphoria Finance: This project is a derivatives trading platform that introduces gamification mechanisms into on-chain trading, combining the fundamentals of price prediction and the efficiency of CLOB market making to create an interesting, social, mobile-first, and game-like trading experience. Euphoria completed a $7.5 million seed round in August last year, led by Karatage, with follow-on investments from institutions such as Robot Ventures and Bankless Ventures. The angel investor lineup includes several notable figures, such as Kain Warwick, founder of Synthetix.
Rocket: A redistribution market where everything can be traded, covering cryptocurrencies, stocks, emojis, NFTs, and even Polymarket odds. As long as the underlying asset has a price, it can be traded on the platform. Rocket completed a $1.5 million seed round last year, led by Electric Capital, with participation from Amber Group, Bodhi Ventures, and notable KOL Taiki Maeda.
Valhalla: The project is positioned as a perpetual contract exchange, utilizing MegaETH's high throughput characteristics to provide users with a low-latency, high-efficiency on-chain derivatives trading experience. Valhalla completed a $1.5 million seed round in December 2024, led by Robot Ventures, with follow-on investments from multiple institutions including GSR and Kronos Research.
Reach: This is a SocialFi collaboration platform for Web3 community creators and contributors, operating in the form of a Discord Bot. It allows creators to set up promotion tasks covering interactive forms such as following, liking, retweeting, and commenting on X, and rewards participants who complete the tasks with ETH or points, aiming to make content promotion more targeted and measurable in returns. Reach completed a $1 million funding round in December 2023, achieving a valuation of $3 million, with participation from NxGen and Punk DAO. Three days after the funding was completed, the platform's native token REACH officially launched.
It can be seen that the MegaETH ecosystem has attracted a batch of projects covering multiple fields such as DeFi, derivatives, and SocialFi before and after the mainnet launch, with some projects even receiving endorsements from top-tier institutions like Paradigm, Dragonfly, and Electric Capital. However, the ecosystem is still in the early stage of development, with most projects yet to launch tokens, and the actual user base and on-chain activity are still in the accumulation phase.
The market's enthusiasm for L2 has significantly waned; MegaETH needs to demonstrate differentiation.
Finally, Vitalik's recent attitude toward the L2 ecosystem has become clearly changed. Although he invested in MegaETH, he has repeatedly publicly criticized the Ethereum ecosystem for being "fragmented," emphasizing that L2 projects should meet the "first-stage" decentralization standards, otherwise it would be hard to say they are important. This is not an empty pressure for MegaETH.
According to its official MiCA Whitepaper, MegaETH is still currently operating under a single sequencer model, with the decentralization of the sequencer and governance layer listed as future progressive goals, rather than already achieved states. According to analysis by Messari, this architecture introduces additional trust assumptions at the execution level. In other words, the final settlement of MegaETH relies on the security endorsement of Ethereum, but the sequencing and execution of transactions are still currently dominated by a single node, and true decentralization has not yet been achieved.
Although the MegaETH mainnet has already launched, ecological validation has only just begun. In the future, MegaETH will need to prove itself an exception to the criticism from Vitalik, rather than yet another case of ecological "parasitism."