Coinbase layer 2 Base NetworkEthereum layer-2 network Base crossed $8 billion in total value locked (TVL) for the first time today. According to data from L2BEAT, the network TVL peaked at $8.08 billion earlier today before dropping $7.94 billion after the ETH price dropped, but that was more than enough to highlight the network’s rapid growth.
Also Read: Base network hits record with over 21,000 smart contracts daily.
With the milestone, Base became the second-largest L2 network within less than a year of being publicly available. The network built using OP Stack launched on August 9 after being available in Beta for six months before that.
Memecoins and Coinbase affiliation drives Base adoption
Base’s rapid growth means it has now flipped OP Mainnet in TVL and is only behind Arbitrum One, which has a TVL of $18.17 billion. Despite being behind Arbitrum on TVL count, the network has seen more activity than its counterpart. Artemis data shows that daily transactions on Base as of June 10, 2024, were 2.5 million, 500,000 more than that of Arbitrum and more than the combined transactions of the following five L2 networks.
The high on-chain activity on Base results from several factors, most importantly, memecoin trading and its association with Coinbase. Like Solana, Base experienced network struggles with rising fees and transaction failures at the height of the memecoin mania. Although that has subsided, the network still has significant memecoin trading activity.
However, it is not just memecoins that are trading on Base. The network is also home to several other protocols, including Uniswap, SushiSwap, Solidly Labs, Xy Finance, Superform, Friendtech, and others. Onchain tokenization protocol Chintai network recently announced that it is deploying on Base in partnership with Coinbase.
“Tokenizing RWA’s is as much about distribution as issuance. Base is a perfect network for enabling the growth of RWA tokenisation, as it allows us to reach the 110M+ verified Coinbase users.”
– David Packham, CEO Chintai Network
Meanwhile, its affiliation with Coinbase has also encouraged adoption among users and developers. With the Coinbase wallet allowing easy access to Base, many Coinbase users have transitioned on-chain through the network, and developers are attracted to the over 110 million Coinbase users who could potentially use the network.
Can adoption continue at this rate?
Despite its growth, the big question remains whether Base can continue to grow at this rate. Its high adoption rate has come at a cost with the proliferation of scammers on the network. A survey discovered that 1 in every six memecoins on Base is a scam, and 91% of these memecoins have security vulnerabilities. Besides that, memecoin mania has reduced significantly as the crypto market bullishness is now more tempered.
Also read: Coinbase Launches Base Network to Enable Developers Build Inflation-Pegged Flatcoins
However, the high rate of scam projects on the network does not appear to bother most users and developers. The daily transaction figure is still very high, with the network generating the highest fee profits compared to its competitors. Its profit peaked in March with 4.72k ETH, but it still managed 2.12k ETH for May.
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