Copy src/game folder to the src folder of your mod/game.
(OPTIONAL) Copy game/mod_hl2/materials in your mod.
Copy game/mod_hl2/fgd/blobs.fgd in your mod.
Go to src/game/client of your mod/game 's source code, open client_base.vpc and add $include "metaballs\metaballs.vpc" somewhere.
Go to src/game/server of your mod/game 's source code, open server_base.vpc and add $include "metaballs\metaballs.vpc" somewhere.
Compile the code.

Basically thats it.

How to use

Open Options of the hammer. Add this fgd to the Game Data Files
Use point_blob_container and point_blob_element in hammer.

Remember

Do not set Grid size bigger then 20. CMeshBuilder cant make more then 32k verticies.
Its ok to have issues with lighting with this implementation. CMeshBuild is peace of shit.

Why is it an entity?

I wanted to make it work on SDK 2013 as well as on any other source game. SDK 2013 dont have particles source code. I whould like to make it to be a particle, but then wont make it for SDK 2013 and even wont be able to make it opensource.