Ethereum layer-2 project MegaETH has revoked a crypto influencer’s $1 million MEGA token allocation. The decision was made after the individual posted about hedging their holdings, which the project cited as a violation of the terms of a one-year lockup agreement.
Influencer's Allocation and Public Sale Details
The influencer, known by the handle IcoBeast, had received the allocation following MegaETH’s public sale. This sale drew a significant amount of interest, securing $1.39 billion from 53,000 bidders. The tokens allocated in this sale represented 5% of the network’s total token supply.
The Remarks Leading to Revocation
In a post on the social media platform X, IcoBeast had written, “need to figure out how to hedge this.” This comment prompted MegaETH to revoke the allocation. The project team stated that the lockup terms explicitly prohibited any resale, transfer, or hedging transactions during the lockup period.
Project's Stance and Justification
MegaETH’s Chief Strategy Officer, Namik Muduroglu, clarified that any sale participant who discussed plans to hedge or resell their tokens would receive a refund and forfeit their allocation. The company emphasized that this rule is designed to prevent violations of applicable laws.
Community Reactions
The community's response to the revocation was divided. Some users contended that the influencer had not actually breached the rule but had merely commented on the possibility of hedging. Others supported the project's decision, believing it was appropriate to allocate tokens to holders who were more likely to remain committed to the project long-term.
Rationale for Reallocation
Muduroglu further explained that given the public sale was 28 times oversubscribed, it seemed illogical to assign tokens to participants who were expressing intentions to sell before even receiving them. He stated that redistributing these allocations would ultimately benefit committed $MEGA holders.
Market Performance and Future Implications
Currently, pre-market trading on Hyperliquid values MEGA at approximately $0.48. This figure is about 7.7% below the $0.525 level at which IcoBeast’s allocation was valued near $1 million. MegaETH has not yet commented on whether similar revocations have occurred for other participants.