Why is Coinbase Building a Layer-2 Blockchain on Ethereum

• 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).

1/ 🔵 We’re excited to announce @BuildOnBase.

Base is an Ethereum L2 that offers a secure, low-cost, developer-friendly way for anyone, anywhere, to build decentralized apps.

Our goal with Base is to make onchain the next online and onboard 1B+ users into the cryptoeconomy. pic.twitter.com/RmwZFJzGGs

— Coinbase 🛡️ (@coinbase) February 23, 2023

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?

0/ 🔵 Hello world.

Meet Base, an Ethereum L2 that offers a secure, low-cost, developer-friendly way for anyone, anywhere, to build decentralized apps.

Our goal with Base is to make onchain the next online and onboard 1B+ users into the cryptoeconomy.https://t.co/Znuu3o3pJw

— Base 🛡️ (@BuildOnBase) February 23, 2023

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.

9/ 🔵

Join us and #BuildOnBase. https://t.co/Pr88mch3iH pic.twitter.com/Qd1x8hGYqz

— Base 🛡️ (@BuildOnBase) February 23, 2023

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. 

6/ Base is for Everyone.

We’re excited to launch Base with an incredible group of builders from across the crypto ecosystem, with more joining in every day.

The best products are built in community and Base will be an open ecosystem where anyone, anywhere can build. pic.twitter.com/TD1UqY9WRv

— Base 🛡️ (@BuildOnBase) February 23, 2023

Builders on Base

• Infura

We are excited to work with @BuildOnBase, an Ethereum L2 network.🔵

Built by @coinbase & powered by the open-source OP Stack @optimismFND, it offers a secure, low-cost, developer-friendly way to build dapps onchain👇 pic.twitter.com/YYOibVPDmO

— Infura (@infura_io) February 23, 2023

• Gelato

Gelato & @safe are making account abstraction available for @BuildOnBase, the new L2 incubated by @coinbase!@BuildOnBase offers a secure, low-cost, developer-friendly way to build dapps on-chain.https://t.co/s6PPUyv9kI pic.twitter.com/a8Ixu62sxP

— Gelato (@gelatonetwork) February 24, 2023

• HopProtocol

1/ Hop is proud to join @coinbase as an early builder on Base.

Coinbase has continued to double down on decentralization and Ethereum setting an example for the whole damn space 👏 https://t.co/qVcF0v7rh0

— HopProtocol (@HopProtocol) February 23, 2023

• Blockdaemon

Onchain is the new online and Blockdaemon is teaming up with @Coinbase.

Learn more about the new L2, Base 👇

— Blockdaemon 😈 (@BlockdaemonHQ) February 23, 2023

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.

1/ They choose Ethereum instead of launching their own L2. This is a massive vote of confidence for Ethereum.

— RYAN SΞAN ADAMS – rsa.eth (@RyanSAdams) February 23, 2023

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. 

Coinbase announced Base, a new L2 (based on the Optimism L2)

L2s continue to dominate the industry

– Almost all txs in crypto are on L2s
– Almost all TVL in crypto are on L2s
– More devs working on L2s than basically every L1

Sidechains (which aren't L2s) are a waste of time

— Sebastien Guillemot (@SebastienGllmt) February 23, 2023

Base, Introduced

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

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