MegaETH\u2019s pre-deposit event unraveled on Tuesday after a cascade of technical failures disrupted what was meant to be a controlled opening for verified users. <\/p>\n
In an X post, the team said<\/a> that configuration errors and rate-limit issues caused the platform\u2019s Know Your Customer system to fail. The pre-deposit was an early window for verified users to lock in MEGA token allocations.<\/p>\n In addition to the KYC failures, a fully signed Safe multisig transaction \u2014 prepared for a later cap increase \u2014 was executed prematurely, allowing new deposits to flow in and pushing the raise past its intended $250 million limit.<\/p>\n \u201cThe $250M cap is filled by people who were spamming refresh on the Pre-Deposit Website and were able to catch the random opening time,\u201d the protocol said. <\/p>\n MegaETH ultimately froze deposits at $500 million and scrapped plans to expand the raise to $1 billion. A retro and a withdrawal option will be released shortly.<\/p>\n \u201cAt no point were assets at risk, but that doesn\u2019t matter; we expect higher of ourselves and there are no excuses,\u201d the team added. <\/p>\n MegaETH is an Ethereum layer-2 protocol designed to deliver ultra-low-latency block processing and throughput, comparable to a real-time Web2 application.<\/p>\n Some users praised MegaETH\u2019s transparency in explaining what happened, but others were far more critical. AzFlin, a developer and DAO founder, argued that the mistakes could have been prevented if engineers had been more careful.<\/p>\n Related: <\/strong><\/em>Aztec launches decentralized and private Ethereum L2 on mainnet, almost<\/strong><\/em><\/a><\/p>\n The pre-deposit window came on the heels of MegaETH\u2019s MEGA token auction<\/a>, which opened on Oct. 27 and was fully subscribed within minutes. <\/p>\n That sale offered 5% of the 10-billion-token supply, with bids ranging from $2,650 to $186,282 and an optional one-year lock-up that provided a 10% discount.<\/p>\n The auction closed on Oct. 30, ultimately drawing more than $1.3 billion in commitments<\/a> and becoming one of the year\u2019s most crowded raises.<\/p>\n Because contributions far exceeded the cap, MegaETH said it would rely on a \u201cspecial allocation mechanism\u201d to determine the amount each participant ultimately receives. <\/p>\n MegaETH is built by MegaLabs, a team backed by major industry figures including Ethereum co-founders Vitalik Buterin and Joe Lubin. <\/p>\n Following its testnet launch in March, the project is now targeting 100,000 transactions per second with sub-millisecond latency. The MEGA token is set to launch in early 2026.<\/p>\nMegaETH\u2019s oversubscribed auction recap<\/h2>\n