MegaETH LPs Protest Kumbaya’s Hidden 50% Fee Split After MEGA Launch

MegaETH liquidity providers (LPs) are furious following the MEGA token launch after Kumbaya, the network’s flagship decentralized exchange (DEX), reportedly took half of their trading fees—without prior disclosure. Between April 30 and May 1, the DEX collected over $375,000 in protocol revenue, according to DeFiLlama data.

Responding to the backlash, Kumbaya stated that “updated documentation along with more details on Kumbaya’s fee structure is coming tomorrow.” Hours later, the team reassured users that the DEX was “safe to use”, attributing a security alert on its site to “malicious manual reports” from disgruntled users.

so the megaeth terminal dex takes 50% of your LP fees. i gave them $4k this morning pic.twitter.com/zpXYaQqHtA— GREEN JEFF (@jeffthedunker) April 30, 2026

Unsatisfied LPs took to X (formerly Twitter) to express their anger, claiming they only discovered the fee split via on-chain data, as the information was reportedly missing from the exchange’s website. One user alleged that Kumbaya had “implied for months” that LPs in certain pools would earn points or tokens upon MEGA’s launch, citing a logo in the UI that was later quietly removed. Another criticized Kumbaya’s close ties to the MegaETH Foundation and recommended migrating to competitor Prism.

The official MegaETH X account has repeatedly endorsed Kumbaya, even calling it “ecosystem critical” upon its deployment in January. Compared to competitors like Uniswap (with significantly lower fees) or Prism (25% fee split), Kumbaya’s undisclosed 50% cut is viewed as predatory, particularly during the surge in trading activity around MEGA’s launch.

However, contrarian crypto lawyer Gabriel Shapiro argued that “the code *is* the disclosure,” adding that “the whole merit of DeFi is that the code is available.”

Since its launch, the MEGA token has declined by approximately 25%, with a fully diluted valuation of roughly $1.5 billion.

MegaETH’s History of Controversy

This is not the first time MegaETH has faced scrutiny. In November, the network encountered issues during a highly anticipated “pre-deposit event”, despite its claims of being “the first real-time blockchain” with 100,000 TPS and sub-10 ms block times. The event was marred by a congested KYC process, preventing many users from participating as the initial $250 million cap was filled within three minutes.

In an attempt to rectify the situation, the team planned to quadruple the cap by queuing a pre-signed transaction in the project’s multisig wallet. However, the transaction was executed prematurely by user chud.eth, who tweeted “oops” before the team adjusted the cap to $500 million. The team later admitted, “Unfortunately, the party responsible for executing the raise tx was unfamiliar with the specific Safe feature.”