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Magic Eden announced Monday it will distribute 15% of all platform revenue to holders of its native ME token while launching a crypto casino called Dicey, marking a sharp pivot away from its NFT marketplace roots as the digital collectibles market remains down 68% from its 2023 peak.
Magic Eden which is known for trading Solana and cross-chain digital assets recounted what the CEO said in a post on X (formerly Twitter) on Monday, Lu argued that speculation is no longer a niche aspect of crypto but mainstream now.
He indicated that it is driven by booming prediction markets and real-money gaming. Putting relevance on how finance and entertainment are converging in digital markets.
“Prediction markets are all over Emmys and the news. Betting is the second fastest growing industry in the US after AI,” – Lu said.
Data from Dune Analytics shows trading volumes in prediction markets hit a record $814.2 million on Monday, a sharp jump from the prior week’s $701.7 million, highlighting heightened activity across platforms such as Kalshi, Polymarket, and Opinion.
Lu’s comments arrive alongside Magic Eden’s announcement that it will expand beyond NFTs into new verticals tied to the supercycle thesis.
The company plans to launch Dicey, a crypto casino and sportsbook platform, this quarter, a bet on users wagering and socializing within a decentralized framework.
Lu also revealed an innovative tokenomics incentive for holders of Magic Eden’s native token (ME): 15% of all Magic Eden revenue will flow back to token holders.
This distribution will be split equally between ME buybacks and staking rewards paid in USDC, with monthly claims starting in March.
“These initiatives aim to align platform success with token holder returns,” analysts say.
Adding that such mechanisms could drive speculative demand for ME. Unlike traditional marketplaces that rely primarily on trading fees or listing volume, Magic Eden’s structure ties growth to broader ecosystem engagement.
However, industry observers caution that speculative incentives can amplify volatility.
Magic Eden’s pivot comes against the backdrop of a weak NFT market. After peaking in 2023, the NFT market capitalization dropped roughly 68%, from $7.95 billion to about $2.5 billion in 2025, according to CoinGecko data.
The downturn contributed to the cancellation of high-profile events like NFT Paris, where organizers blamed sustained market weakness despite significant cost-cutting efforts.
Even as traditional NFT sales declined, Magic Eden reported maintaining a healthy marketplace business, generating approximately $24 million in revenue over the past year.
Early 2026 shows tentative signs of recovery, with the global NFT market cap climbing back above $3 billion in the first weeks of the year, a roughly 28% increase over 20 days.
These mixed signals underscore the broader crypto landscape’s fluidity: while collectors step back, speculative and interactive formats are attracting fresh attention.
Magic Eden’s supercycle strategy reflects a calculated response to shifting user behavior in digital assets.
By blending elements of finance, gaming, and community incentives, the company aims to capitalize on trends many in the industry see as next-generation engagement models.
Still, not all observers are convinced the strategy is without risks. Regulatory uncertainty around prediction markets in key jurisdictions, particularly the U.S., could complicate future rollouts.
Moreover, tying tokenholder rewards to speculative activity may heighten ME’s price volatility, potentially deterring risk-averse investors.
Yet Magic Eden’s leadership remains optimistic. The company’s revenue-sharing model, decentralized gaming products, and strong position in NFT and token trading suggest it is committed to weathering cyclical downturns.
