The team promised to return funds to depositors after what it called “sloppy” execution of the pre-deposit bridge for its native stablecoin.
MegaETH said on Thursday evening that it will return all funds from its Pre-Deposit Bridge campaign, calling the execution “sloppy.”
In an X thread on Nov. 27, the team said the process wasn’t “aligned with our goal of preloading collateral to guarantee 1:1 USDm conversion at mainnet.” The campaign, which took place about a month after the completion of its sold-out initial coin offering (ICO), had users deposit USDC to mint USDm, MegaETH’s native USD stablecoin. The refund will go through a new smart contract that is still being audited, the team said.
Users that participated in the bridge campaign were speculating that depositors would be rewarded with points toward the upcoming MegaETH rewards campaign for early supporters. MegaETH stressed in today’s X thread that depositor contributions “will not be forgotten.”
The team noted that it will still reopen its USDC-USDm conversion bridge ahead of the launch of MegaETH’s Layer 2 mainnet beta, dubbed Frontier, to “deepen liquidity, easing user onboarding prior to launch.”
Pre-Deposit Chaos
The U-turn comes just days after MegaETH opened the pre-deposit bridge for USDm. The launch started to fall apart almost immediately when Sonar, the third-party token sale platform handling identity verification for the campaign, blocked deposits for about an hour after hitting its traffic limit, MegaETH said in a post-mortem report on Nov. 25.
After the issue was resolved, the campaign’s initial $250 million cap filled in just over two minutes. The MegaETH team then decided to raise the cap to $1 billion to allow for more participation, and, about 50 minutes ahead of time, announced when the bridge would reopen with the updated cap.
But, at the time of its announcement, the team had already made the required number of signatures on the multisignature transaction to reopen the bridge at a $1 billion cap. Because of how Safe multisig works, if all required signatures on a transaction are made, it means the transaction can be executed by anyone on-chain.
An X user known as chud.eth spotted this and executed the transaction about 34 minutes earlier than the team had planned, reopening the bridge ahead of schedule, and causing further chaos.
MegaETH rushed to reset caps first to $400 million, then $500 million, where it ended up leaving the deposit cap, which filled at that level.
Previous Funding Rounds
MegaETH has drawn attention since early 2024 through community-led fundraising and stablecoin focus. Its most recent raise, an ICO conducted via Sonar in October, saw demand exceed the $50 million cap by 20x with over $1 billion in comittments from more than 38,000 participants bidding for MEGA token allocations.
Earlier funding rounds, including the Echo raise in 2024 and the Fluffles soulbound NFT drop in early 2025, also saw strong investor interest, selling out quickly.
