The pre-deposit phase of MegaETH, a Layer-2 protocol designed to provide ultra-fast transaction speeds on Ethereum, has been marred by significant technical issues. The event, intended for verified users to lock in their tokens, faced disruptions caused by configuration errors and rate-limit problems impacting the Know Your Customer (KYC) system, leading to a malfunctioning deposit process. Further complications arose from a premature execution of a multisig transaction that allowed deposits to exceed the initial $250 million target, resulting in a total raised of $500 million. As a result, MegaETH halted further deposits and canceled plans for an additional $1 billion cap increase. The team assured users that no assets were at risk but highlighted the need for heightened operational standards going forward. This incident has sparked concerns about the platform’s readiness for mainstream adoption in the DeFi ecosystem.