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MegaETH Halts $1 Billion Expansion After Botched Pre-Deposit

The layer-2 project cites a misconfigured multisig with KYC rate limits as the cause, leaving roughly $500 million locked in team-controlled contracts.

Overview

  • The initial $250 million cap for KYC-verified Sonar wallets filled in about 156 seconds after a brief site reopening.
  • Rate limits at Sonar and overloaded third-party APIs blocked many verified users and caused an unpredictable reopen that favored those repeatedly refreshing.
  • A Gnosis Safe multisig was misconfigured, making a cap-change transaction executable early and triggering uncontrolled deposits.
  • Attempts to raise the limit to $400 million and then $500 million were executed too late, leaving about $500 million in team-controlled contracts with no exploit reported by auditors Zellic and Slowmist.
  • MegaETH scrapped the $1 billion plan, says a withdrawal page is coming for refunds, will preserve participants’ reward credit, and promises a full retrospective on the failures.