Case For Base 🕹️
The Ethereum L2 that's making all the noise. Built on Optimism OP stack and backed by Coinbase. Can Base deliver on the promise and bring value to the L2 + Ethereum, contributing to mass adoption?
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Coinbase's stock is soaring after a strong first quarter, but can their new product, Base, keep the momentum going?
Base the game changer?
Launched in 2023, Base is a low-cost Ethereum layer-2 solution that aims to speed up transactions for Coinbase users.
Early signs are promising – trading volume on Base has exploded, surpassing competitors like Optimism and Arbitrum.
What’s fuelled the growth? Dencun upgrade and Base's support for over 250 DeFi protocols.
The Dencun upgrade has made everything cheaper.
And Base made things much easier on Ethereum.
Read: Ethereum's Dencun Upgrade 🦋
Base, is minting millions
Since the upgrade on March 13, Base has consistently processed more than 2 million transactions daily.
Spike in new users.
The transaction fees.
And the TVL?
Base is now the 2nd largest Ethereum layer 2 network.
Base generated the most on-chain profit of any layer-2 chain with $6.1 million in May.
Coinbase as the leader of DeFi?
Analysts are calling Base a potential game changer.
With its rapid adoption and revenue generation, some believe Base could position Coinbase as the "NVIDIA" of DeFi, a dominant industry leader.
While Bitcoin's recent halving might dampen crypto markets in the short term, the long-term outlook remains bullish.
The rise of Bitcoin ETFs in the US and Hong Kong could provide consistent support for crypto prices, benefiting Coinbase.
Coinbase isn't just about trading fees.
Their revenue from custodial services, like storing assets for Bitcoin ETFs, is growing rapidly and could help offset any future declines in trading volume.
Coinbase is making a strategic bet on Base to diversify its revenue streams and become a major player in the DeFi space.
Can Base knock Solana off its throne?
Solana currently reigns supreme in the world of memecoins.
The new challenger has entered the arena: Base.
How has Solana aced the memecoin game?
Airdrops from Jito, Jupiter, and others pumped cash into the ecosystem, leading to rapid growth.
Solana boasts popular memecoins like WIF, BONK, and BODEN, appealing to a broad audience with dogs, cats, and even politicians.
Platforms like pump.fun have made Solana a hub for memecoin launches, attracting massive interest.
How can Base stake a claim?
Base has emerged as a top Ethereum L2 with a promising memecoin scene. Projects like DEGEN and friend.tech show potential.
Base leverages its low fees to attract memecoin enthusiasts.
Base fosters niche memecoin communities like Brett (inspired by Pepe creator Matt Furie).
However, Base's memecoins cater more to crypto insiders, lacking the broader appeal of Solana's offerings.
The Base L2 Culture
Base L2's culture plays a significant role in influencing its user engagement.
The platform has developed a distinct culture that sets it apart from other L2 solutions like Optimism and Polygon.
Community Building: Fostered a strong sense of community among its users. Popularity is partly due to its unique NFT markets, where being "based" is a big deal. A sense of belonging and encourages users to participate in the ecosystem.
User Engagement Strategies: Coinbase has implemented various user engagement strategies. Creator Jesse Pollak spreading "based vibes" through memecoin Telegram groups, to maintain user interest and enthusiasm.
Revenue Generation: Base L2's culture has been successful in generating revenue. The platform's gross profit nearly cleared $4.5 million over the past week alone, up from under $100,000 in the first week of January.
Innovative Projects: Attracted innovative projects, such as friend.tech, which gave users a familiar proof of concept to engage with. This has helped to maintain user interest and attract new users.
NFT Markets: The platform's NFT markets, featuring unique digital art collections like Tiny Baseds Frogs and Primitives, have seen millions of dollars of trade in the past week. Contributing to the platform's popularity and user engagement.
User Retention: Platform's unique features and community engagement strategies have encouraged users to continue participating in the ecosystem, leading to increased user retention.
Base to lead SocialFi charge
Investment giant Franklin Templeton believes Base is perfectly positioned to dominate SocialFi space.
Why Base?
SocialFi Leader: Base already boasts a whopping 46% share of SocialFi transactions, leaving competitors like BNB Chain and Polygon in the dust.
Coinbase Boost: Franklin Templeton credits Coinbase's support for Base's impressive growth, particularly the "Friend.tech" platform that lets creators monetise content through "key" shares.
SocialFi's Big Potential: Franklin Templeton views SocialFi as a key driver of Base's future adoption and a major trend to watch.
Though currently controlled by Coinbase, Base also plans to gradually decentralise over time.
Friend.tech drama
The Web3 social network's co-founder, going by the alias Racer, just threw a wrench into things by suggesting they might ditch Base on May 26.
This social media bombshell sent Friend.tech's token, FRIEND, into a tailspin, falling from the highs of $2.4 to $0.8 in value.
According to Racer, the Friend.tech team feels ostracised by the Base community.
They believe there were misunderstandings during launch, leading to some bad blood.
"Farcaster investors went apeshit smearing us when we launched because they misunderstood what we were doing. Pushed it really hard on their team and users and the relationship has been downhill since then with us getting ostracised from anything that is for the 'Base community'."
Racer even offered a $200,000 bounty to anyone who can help them migrate away from Base smoothly.
Base responds
Now they are coming up with a blockchain?
The future of Base
Strategic Alliances: Collaboration with Optimism L2 ensures best features from both platforms, enhancing security, scalability, and affordability.
Security and Scalability: A robust design that leverages Ethereum's inherent security structures and Coinbase's top-tier protocols. Optimism OP Stack ensures scalability, and seamless integration with pre-existing Ethereum-based smart contracts.
Developer Environment: EVM compatibility simplifies dApp development and deployment for developers to build and deploy decentralised applications (dApps) on the platform.
User Adoption: Growth is expected to continue as the platform expands its features and user base.
Future Development: Coinbase has announced plans for "Onchain Summer," a series of events for creators and developers to create art or develop applications on Base, with participants including Coca-Cola, Atari, and OpenSea.
Competitive Advantage: Alignment with Optimism and Ethereum provides access to millions of users and a familiar tech stack. Integration with Coinbase open up vast network of investors, builders, and service providers.
Impact on Optimism and Ethereum: The success of Base is expected to benefit both Optimism and Ethereum. If Base wins, it will likely drive value to the L2 + Ethereum, contributing to the growth of the Ethereum network.
Roadmap: More partnerships, deeper integration with other platforms, and a focus on user education and engagement. This will help the platform continue to innovate and expand its user base.
What’s the promise? A robust and scalable L2 blockchain solution that leverages the strengths of both Coinbase and Optimism.
TTD Week That Was 📆
Saturday: Bitcoin Treasuries 💵
Friday: Robinhood On Charge 🤠
Thursday: Celebrity Memecoin Chaos 🙆♀️
Wednesday: Ethereum to $5k?🪁
Tuesday: 'Bitcoin Fixes This' ... Really? 👀
TTD Week in Funding 💰
Avail. $43M. Data availability blockchain. Recording blockchain transactions, prove that block data is available without downloading the entire block.
Fhenix. $15M. Homomorphic encryption blockchain, using fhEVM to enable Ethereum developers to build encrypted smart contracts using Solidity.
Nubit. $8M. Scalable Bitcoin-native data availability layer empowering applications like Ordinals, layer 2s, price oracles, and indexers.
Mountain Protocol. $8M. Users can purchase and redeem USDM at a pegged value of $1. All funds in the platform are auto-converted to USDM once settled.
Halo. $3M. Secure and easy-to-use crypto wallet that supports multi-chain aggregation for Web3 users through the social web.
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