The DEGEN L3 community, a prominent blockchain layer dedicated to decentralized finance (DeFi) enthusiasts, is facing a challenging situation with its service provider, Conduitxyz. In a recent statement, DEGEN founders Jacek and Colton shared the ongoing struggle over migrating DEGEN L3 away from Conduitxyz’s services, citing months of uncooperative behavior, mishandled upgrades, and withheld keys critical to the chain’s operation.
Problems began when Conduitxyz implemented an upgrade without notifying DEGEN L3’s team, causing 54 hours of downtime and resulting in $160,000 in user fund losses. Before this incident, DEGEN L3 had processed over $200,000 in bridge volume daily. Following the unannounced disruption, bridge volume dropped by more than 75% over the subsequent month, impacting the ecosystem’s vibrancy and user engagement.
Conduitxyz’s Alleged Uncooperative Stance
According to DEGEN L3’s founders, Conduitxyz has refused to take responsibility for the community’s damages and has further complicated recovery efforts by withholding sequencer fees and reneging on requests for essential chain upgrades. The company allegedly proposed a contract that would absolve them of responsibility, prolonging negotiations over three months without any resolution.
The DEGEN team also accuses Conduitxyz of stalling tactics, stating that the provider has refused to release roll-up keys, which are critical for enabling DEGEN L3’s migration to a new host. Without these keys, DEGEN L3 is effectively locked into Conduitxyz’s infrastructure, leaving the team unable to execute upgrades or ensure user stability.
Despite ongoing setbacks, DEGEN L3’s founders expressed their commitment to overcoming these challenges, even if it means launching a new chain altogether. They disclosed plans for an upgrade that could have been implemented with a single signed transaction from Conduitxyz. Still, the provider has allegedly refused to cooperate, instead advising DEGEN L3’s new provider to handle the transition.
In their message, Jacek and Colton reassured the community that this “small speed bump” would not affect other aspects of the DEGEN ecosystem, including tipping and the Base crypto token. They encouraged users to continue engaging with the platform and hoped to restore trust soon.
