Closing as won't fix, this looks like a mistake in your events. Please also see the bug report requirements regarding providing a minimal .capx; this project has over 100 events, most of which are unrelated to the problem.
The problem seems to stem from the first action of event 7 in the "Rope" sheet. It looks like you create a chain of objects going vertically down, then you just "set position" the last one to the destination position. As the physics tutorial describes, this effectively teleports the object, and since teleporting an object is a physically unrealistic thing to do the results are often also physically unrealistic. I think you need to find a better way to create the chain.
How come it worked in the past then? Since the update to the physics, it does not work.
Kind of odd that we're not suppose to reposition a physics object. I think a lot of situations repositioning an object with physics makes sense. In a game , you need to teleport objects in a lot of cases. Games aren't suppose to be realistic.