I just ran into this issue as well running the latest stock firmware. It seems that the latest Asus RT-AC88U firmware changed to include certificate checks.
I'm not sure how to get around it when already running Asus/Merlin but here's what I did to get around the error when going from Stock to Asus/Merlin:
1) Ensure that Auto Upgrade is off (something added recently to the stock firmware as well)
2) Download the .385 firmware from the Asus site
3) Install that via Manual Firmware Upload
4) Once it's rebooted, log on and then install the latest Asus/Merlin
5) Bingo
I seem to have run into this problem while running merlin for more than 3 years with no issue updating at all and now all of a sudden I can't update from 386.3 to 386.3_2 with the error above invalid Firmware"
any idea how to overcome this without a factory reset or cleaning out the router?
Thanks, I did not have anu usb devices connected but I rebooted the router and tried that a couple of times, the fourth time it accepted the firmware….. weird behaviour if you ask me.
any background why this pops up now and then, reading on the interwebs sounds like this is an issue from multiple versions?