Reliability at Scale: Degen Chain's Alchemy Success Story
Degen faced a problem: their rollup infrastructure had stopped working, and hundreds of thousands of user funds were irretrievably lost.
An early rocket ship of the current crypto cycle, DEGEN is a reward token on Farcaster, enabling users to tip and reward creators for quality content on the social platform. The tipping protocol, steeped in Internet speak and degenerate meme culture, attracted massive interest from users flocking to the new SocialFi experience that Farcaster created.
Degen, the team behind the protocol, launched a rollup to create a home for this surging, memeified community. Being a high-throughput application at the intersection of memes, media, and markets, a rollup would be necessary to expand the protocol and create the experience their community expected. As one of the first Layer 3s settling to Base, Degen Chain was primed to take advantage of Onchain Summer and the resurgence of memecoins after crypto winter.
But their rollup infrastructure kept experiencing severe problems.
Infrastructure failures are costly
The team first deployed Degen Chain using a Rollups-as-a-Service (RaaS) provider. Severe chain infrastructure outages quickly derailed the rollup, its token, and community. Further infra issues bled into a bridge provider error that lost hundreds of thousands of dollars in user funds. Degen ultimately had to repay these user funds out-of-pocket. These events led to further ugly issues involving upgrade key control, contractual disputes, and public backlash.
The shift to reliability
Degen Chain needed a provider with experience running enterprise-level infrastructure and deep expertise working with Arbitrum's team and the Arbitrum Orbit framework, so they began to search for alternative partners.
When we met the Degen team in mid-2024, it became clear that we were the provider who could 'right the ship'. With years of operational expertise running the largest apps and chains in web3, we could stabilize and expand Degen Chain. Then, the team could start to seriously build the rollup experience they'd envisioned.
“We made a lot of expedient choices to get to market quickly and capitalize on our explosive community growth and interest, but once the chain performance struggled to match demand, we had to evolve our infrastructure to keep up with our community's standards.
We have big dreams for DEGEN, and that means getting the right partners to regain trust and deliver on our roadmap.”
“Degen Chain showed how fast a rollup can capture attention and how critical infrastructure maturity becomes at scale,” says Jonathan Kau, Product Lead for Rollups. “We knew we could step in with deep Arbitrum expertise to help stabilize the chain and enable Degen’s community to keep building with confidence.”
First, however, the chain would need to migrate to our Rollups-as-a-Service platform.
How a rollup migration works
A chain migration is when a rollup switches RaaS providers, transferring all of the critical state and operational responsibilities of the rollup from one infrastructure provider to another.
This is a coordination-intensive process that requires significant developer resources. With many moving pieces, there's a significant downside should the migration be performed improperly.
Migrating a rollup involves multiple steps, including:
Handing over keys
Spinning up new infrastructure
Carefully migrating components one by one with minimal to no downtime.
Working with Degen's partners that run RPC nodes to use the new sequencer.
Communicating with the rollup's developer and user communities is also essential, ensuring both groups are aware of any downtime, changes in tooling, and more.
“Migrating an existing rollup requires an experienced team with high operational excellence and deep understanding of the sequencer technology,” says Dan Li, Engineering Lead for Rollups. “With our 7 years of experience, we have institutional knowledge that other teams can’t replicate. A mainnet migration is not the time to risk your new RaaS provider learning an important lesson.”
Why Degen Chain needed to migrate
From May through June 2024, Degen Chain experienced multiple large-scale infrastructure problems from its RaaS provider. In May, the chain was completely down and unusable for 54 hours due to an insufficiently tested update pushed out without warning. Two months later, another miscalibration with the bridge provider bled users’ funds, leaving Degen on the hook to repay its users.
The Degen team had experienced enough problems and started the process of migrating RaaS providers.
“Alchemy was an easy choice as one of the most familiar and trustworthy brands for developers building in web3, and a mature infrastructure provider supplying SLAs to some of the world’s largest organizations.
We knew our community would rally with such a strong partner helping us to shore up our chain operations.”
Technical overview of migrating RaaS providers
TLDR: migrating a chain consists of snapshotting the chain, replicating it perfectly, redeploying smart contracts, and moving endpoints and services over to Alchemy — all in a condensed timeline.
Plan for success
To begin the migration, we collaborated with Degen to plan the transition and outline a roadmap for their optimal chain operations and future growth. We also worked closely with their former RaaS provider to settle issues related to Degen's wallets, contracts with the provider, and to draft a migration plan. Although migrations can be complex, there is typically minimal work on the rollup customer’s end. We prioritize white-glove service for all customers, allowing them to focus on building their products and community.
All hands on deck
After finalizing all necessary prerequisites, we worked closely with both teams to coordinate the complex migration process. We set up an Alchemy-side mirror of chain infrastructure in “standby” mode, in preparation for migration. Nodes like the sequencers, batch-poster, validators, Anytrust committee members, and more would sync from the chain but not take action.
Execute
On execution day, the different components of the chain were carefully migrated over in a specific order to avoid “split brain” scenarios. We moved intentionally through each component and validated success via logs/metrics to ensure a smooth transition. Wallets in charge of important chain functionality (like the batch-poster and validator) were then swapped over to Alchemy-managed wallets. Finally, external services such as bridges, public RPC, and block explorer were migrated over to use Alchemy RPC endpoints.
After hours of focused work and coordination, Degen Chain was safely deployed to Rollups without issue. Estimating engineering hours can be challenging, but the Rollups team spent weeks of preparatory work in order to deliver a painless migration.
The Degen and Rollups teams could now focus on executing their roadmap.
Building with Alchemy
With Degen Chain successfully migrated, the team could focus on recapturing the community momentum DEGEN had earned early on:
First, we upgraded Degen Chain to the newest ArbOS version, which their previous provider had declined to implement. The upgrade gave Degen developers access to features like Arbitrum Stylus, giving the ability to write contracts in Rust.
Next, with ArbOS upgraded, we spent extra time tuning Degen Chain’s settings to enable fast withdrawals. Adjusting the settings involves a tradeoff between withdrawal speeds and how much money Degen Chain uses to post to the parent chain.
Finally, we implemented a new LayerZero bridge, after prolonged negotiations with their former RaaS provider to sign the transactions required to deploy a new bridge. The Degen community can now easily move, deposit and withdraw assets from the chain to many destinations, including Solana and Arbitrum. This was important from a product viewpoint, but, more importantly, from a community trust standpoint.
With several key engineering wins post-migration, Degen Chain was well-positioned to start 2025 with a flurry of roadmap building and user activity.
Results, and what's next
Since migrating to Alchemy, Degen Chain's weekly bridged funds to the chain have doubled, returning back to more healthy rates from before the incidents, and TVL has grown by 20%.
The chain has now processed more than 100 million transactions with the average gas on a transaction at less than one hundred-thousandth of a cent. Deployers have created over 115,000 contracts at the intersection of memes, media, and markets to take advantage of this high throughput, low cost chain.
In anticipation of further growth, Degen has begun its much awaited Airdrop 3, giving away more than 9 billion DEGEN to developers who want to build apps and extensions for the DEGEN L3 and using DEGEN as the native currency. The invitation is open for intrepid developers to help fine-tune the L3 for their use case, even going so far as to build out custom oracles, blockspace auctions, precompiles, and other data availability that may be necessary for new applications.
Whatever happens next, Arbitrum will be a valued partner working closely with DEGEN to push the state of rollups forward to support decentralized applications operating at global scale.
Why migrate your rollup to Alchemy?
We launched Rollups to help customers deploy or grow an enterprise-grade rollup. By migrating your rollup to Alchemy, you’ll get:
Enterprise-grade infrastructure with an uptime SLA
White-glove customization and support at every step
The complete suite of developer tools (10+ APIs, Smart Wallets, AA, and more) that powers companies like Coinbase, OpenSea and Robinhood
Ecosystem support with access to 30+ integrated partners, co-marketing and developer growth
If you're a deployed rollup and want to migrate to a true white-glove, experienced RaaS provider, we’d love to speak with you!
