MegaETH is canceling its pre-launch “Pre-Deposit Bridge” and returning all user deposits following a series of technical errors and operational missteps. The initiative, intended to seed liquidity for USDm — the stablecoin that will underpin the Frontier mainnet — quickly turned into one of the most chaotic fundraising attempts of the year.
The team admitted that the execution “was sloppy” and that user expectations around the $250 million cap did not align with MegaETH’s internal goal of preloading collateral to ensure 1:1 USDm conversion at launch. Refunds will be processed through a new smart contract currently under audit.
Problems began immediately. Transactions failed at launch due to an incorrect SaleUUID in the contract, requiring a 4-of-6 multisig correction. At the same time, the KYC provider Sonar applied an unexpectedly strict rate limit, blocking significant portions of user traffic. It took more than twenty minutes for the team to identify and resolve the issues.
When deposits reopened, they did so at a randomized time. Users actively refreshing the interface quickly reached the $250 million cap, leaving others relying on official communications effectively locked out. An attempt to raise the cap to $1 billion was triggered roughly 30 minutes early by an external party due to the mechanics of Safe multisig transactions. Subsequent attempts to lower the cap to $400 million and $500 million failed as deposits continued to flood in, ultimately forcing MegaETH to halt the process amid unresolved KYC bugs.
MegaETH emphasized that no funds were at risk and said depositors would be recognized in the future, though details remain unclear. The USDm and USDC-to-USDm conversion bridge will reopen prior to Frontier mainnet launch under a more controlled setup.
The incident puts added pressure on MegaETH to demonstrate that its remaining roadmap and infrastructure are production-ready and capable of avoiding similar operational failures.
