Why is Coinbase Building a Layer-2 Blockchain on Ethereum
Subscribe to our newsletter!
- Coinbase Global Inc. has launched Base, its own layer 2 blockchain for Ethereum, offering a secure, low-cost, and developer-friendly way to build decentralized applications.
- Base leverages the security and scalability of Ethereum and is powered by layer-2 network Optimism, allowing interoperability with other Layer 1 blockchains like Solana and other Ethereum second-layer networks.
- While being built on top of Ethereum, the move is seen as a massive vote of confidence for Ethereum and its potential to become the world’s settlement layer. Base is open-source and does not have a native token.
On February 23, 2023, cryptocurrency trading platform Coinbase Global Inc. launched Base, its own layer 2 blockchain for Ethereum (ETH).
Coinbase is a cryptocurrency exchange founded in 2012, which currently serves approximately 110 million verified users. According to CoinGecko, it is the second largest exchange in terms of trading volume, behind Binance.
“We’ve incubated Base inside at Coinbase, leveraging our decade of experience in crypto. Base is Coinbase’s contribution to the core infrastructure of the cryptoeconomy: a commitment to scale Ethereum and unlock the next wave of growth and adoption,” Coinbase stated.
What is Base?
It is secured on Ethereum and powered by layer-2 network Optimism; Base brands itself as a “secure, low-cost, developer-friendly” way to build decentralized applications (dApps). Moreover, it will also cater to Coinbase’s own on-chain products as well as an open ecosystem for developers.
Perks of using Base
According to its developers, Base leverages the underlying security of Ethereum and “Coinbase’s best practices.”
Coinbase also noted that Base will be interoperable with other popular Layer 1 blockchains like Solana (SOL), as well as with Ethereum’s base layer and other Ethereum second-layer networks. Base will also be able to utilize Coinbase’s product integrations, easy fiat onramps, and powerful acquisition tools.
In addition, Base is also open source aiming “to be decentralized, permissionless, and open to anyone with the vision of creating a standard, modular, rollup agnostic Superchain powered by Optimism.”
“Base is for Everyone,” they highlighted.
Builders on Base
No Native Token?
Contrary to other blockchain networks, Coinbase stated that although their plan is to “progressively decentralize the chain over time” they clarified that having and issuing a native token for the chain is not a part of it.
Bullish for Ethereum
While being built on top of Ethereum, the crypto community is expressing optimistic thoughts about the platform.
Ryan Sean Adams, host of the Bankless Show, affirms that Coinbase’s the move “is a massive vote of confidence for Ethereum.” According to him, building Base on Ethereum could lead cryptocurrency companies and financial institutions to also use the network as their settlement layer.
Ethereum enthusiast Twitter user @sassal0x also claimed that Ethereum is becoming the world’s settlement layer.
Blockchain infrastructure firm dcSpark co-founder Sebastien Guillemot also commended Coinbase for building a layer 2 network.
“If you hear someone say that L2s don’t have good enough UX for adoption; clearly they stopped paying attention to blockchains in 2020 and it’s time to look elsewhere for a roadmap vision,” he stated.
Aside from their testnet launch, Base also launched their free non-fungible token (NFT) collection ‘Base, Introduced’ to celebrate the launch and welcome users to join the “broader Base community.“
As of writing, the token is still open for free mint and will remain open for less than five days. To claim, visit Base, Introduced.
This article is published on BitPinas: Why is Coinbase Building a Layer-2 Blockchain on Ethereum
Disclaimer: BitPinas articles and its external content are not financial advice. The team serves to deliver independent, unbiased news to provide information for Philippine-crypto and beyond.