Base: Layer 2 Blockchain on Ethereum By Coinbase
Coinbase announced Base, an Ethereum-focused layer-2 (L2) blockchain, on Thursday, February 23, in a drive to enter the decentralised ecosystem through its own chain and grow further into the developer community.
Coinbase, one of the largest cryptocurrency exchanges in the world, has entered the blockchain space with the introduction of Base, an Ethereum-focused layer-2 (L2) network. Base's launch aims to penetrate the decentralized ecosystem via its own chain and push deeper into the developer area.
Base's L2 Blockchain is a "safe, low-cost, developer-friendly" chain that intends to assist developers in creating on-chain decentralized apps. Numerous cryptocurrency companies, platforms, and infrastructure providers, like Chainlink and Etherscan, have pledged to build on Base. The release of Base highlights the relevance of L2 blockchains in expanding the blockchain ecosystem and making it more accessible to a wider range of developers and consumers.
Coinbase BASE Blockchain
Base is an Ethereum Layer 2 Blockchain that Coinbase controls and operates internally. But, the goal for the future is complete decentralization and compatibility with other blockchain networks.
The OP Stack is used to construct the base. This will enable the L2 to use Optimistic Rollups. Base will use this technology to verify and roll-up transactions off-chain (in large batches) before sending them to Ethereum. This will lessen Ethereum congestion. It will also assist Base users in avoiding Ethereum's exorbitant, gas-heavy transaction costs.
Projects built on Base will also be able to benefit from Coinbase's current ecosystem. This includes its numerous product integrations, simple fiat onramps, 110 million verified users, and $80 billion in assets on the exchange.
“We encourage them to start on Base, but go everywhere: we see Base as a “bridge” for users into the cryptoeconomy,” Robinson said. “It’s an easy-to-use default onchain experience with access to products on other chains.”
On 23rd February, Coinbase tweeted about the features of Base that,
“Base will be:The onchain home for Coinbase. An open ecosystem where anyone, anywhere, can build dapps that reach the next 1B+ users. A bridge that brings our users onchain and enables them to go anywhere, including L1, other L2s, and ecosystems like Bitcoin & Solana”
Base’s Key Feature: Interoperability
Interoperability is a key feature of Base, Coinbase's newly launched Ethereum-focused layer-2 blockchain. The roadmap for Base includes integration with Coinbase's exchange and wallet, as well as support for Coinbase NFT.
However, the Base team has even bigger plans beyond Ethereum. In order to foster broader adoption of decentralized applications, Base aims to be interoperable with other blockchains in the ecosystem. The team has already held talks with several leading L1 and L2 protocols, including Polygon, Solana, and Avalanche, to pave the way for seamless cross-chain communication.
With its focus on interoperability, Base is poised to become a crucial component of the decentralized ecosystem, connecting different blockchains and enabling the free flow of value and data.
Base’s Low Fees and Open Source Nature
Base also aims to democratize access to decentralized applications by offering low transaction fees. It aims to charge an initial fee of just $0.10 or $0.20, which is comparable to other Ethereum Layer 2 counterparts like Arbitrum and Optimism.
Base Blockchain is not just low-cost, but it's also designed to be accessible to developers of all sizes. Here are some key points about the platform's cost and accessibility:
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In the future, Base intends to reduce its transaction fees to $0.01, depending on the success and adoption of the platform.
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Base is completely open-source and free to use, allowing anyone to contribute to it and make it more decentralized and permissionless.
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The platform has established an ecosystem fund in partnership with Coinbase Ventures, one of the most active VC firms in crypto, with over 240 investments to date.
By keeping fees low and making the platform open source, Base aims to make it easier for developers to build on the blockchain, thereby expanding the decentralized ecosystem. With the support of Coinbase Ventures, Base Blockchain is poised to become a significant player in the blockchain space.
Base is not a New Token
Coinbase made it clear that they do not intend to launch a new network token. It’s just a new layer 2 blockchain named “Base”. This announcement was made due to the fact that whenever a celebrity says something or a new project is launched, a new crypto token is generated to manipulate investors either to scam them or to rug-pull the money.
Testnets are settings that simulate real-world blockchain use. Layer 2 blockchains are built on top of layer 1 blockchains, which alleviate bottlenecks with scaling and data and are often significantly faster and cheaper.
Coinbase has also unveiled the Base Ecosystem Fund, which will invest in and promote early-stage startups built on Base that match predefined investment criteria.
Base’s Mainnet Launch and Coinbase’s Stock Raise
On February 23, the Base testnet went live. The project's staff is already hard at work on the mainnet, which is set to go live in the second quarter of 2023.
The announcement of the introduction of Base has already had a good influence on Coinbase's share price, which has increased by 10%. $COIN has risen from $58.44 on February 24 to $64.83 as of this writing. It also bodes well for the Optimism Ecosystem. For example, once Coinbase announced the launch of its L2 platform on the OP stack, the platform's native token, OP, increased by 16 percent.
Base has also bolstered VELO, Velodrome Finance's native cryptocurrency. Following the introduction of the Basic testnet, the token increased by 21%.
How will Base be a Game Changer?
Accessibility: Coinbase is already an accessible on-ramp to crypto for non-natives. With Base, Coinbase is perfectly positioned to onboard new users into the cryptocurrency world.
Security: Coinbase products are already among the easiest to use in the industry and used by millions. Base is secured by Ethereum and Coinbase's own security practices, ensuring the platform is as secure as possible.
Interoperability: Base is designed to be "a bridge, not an island." The platform is built to provide easy access to other L2s, allowing users to be introduced to the entire cryptocurrency space.
Low fees: Base aims to charge an initial fee of around $0.10 or $0.20, similar to other Ethereum L2 counterparts such as Arbitrum and Optimism itself. However, in the future, Base aims to reduce its transaction fees to $0.01, depending on the success and adoption of Base.
Decentralization: Base is designed to be fully open-source and freely available. Anyone can contribute to it, making it more decentralized and permissionless. The project has already set up an ecosystem fund in collaboration with Coinbase Ventures, which will incentivize and support project developers looking to build on Base.
Conclusion
Coinbase, one of the world's leading cryptocurrency exchanges, is partnering with BuildOnBase to support the launch of its Layer 2 (L2) platform. BuildOnBase, or simply Base, is a new L2 blockchain designed to increase transaction speeds, lower fees, and provide easy access to other L2s, including its partner Optimism, Ethereum L1, and even other L1s like Solana. As a data partner, Flipside has been decoding and curating Base data in early access, making it easy to query and create data on Base for free.
Base FAQs
What is Base?
Base is a layer-2 blockchain network developed by Coinbase to assist developers in creating on-chain decentralized apps with low transaction costs and enhanced scalability.
What is the goal of Base's L2 blockchain?
The goal of Base's L2 blockchain is to assist developers in creating on-chain decentralized apps and make blockchain technology more accessible to a wider range of developers and consumers.
What are the key features of Base?
The key features of Base include interoperability, low transaction fees, and accessibility for developers of all sizes.
What is the roadmap for Base?
The roadmap for Base includes integration with Coinbase's exchange and wallet, as well as support for Coinbase NFT. In the future, Base aims to reduce its transaction fees to $0.01, depending on the success and adoption of the platform.
What is the significance of Base in the blockchain ecosystem?
Base is poised to become a crucial component of the decentralized ecosystem, connecting different blockchains and enabling the free flow of value and data.
What is the Base Ecosystem Fund?
The Base Ecosystem Fund is a fund established by Coinbase Ventures that will invest in and promote early-stage startups built on Base that match predefined investment criteria.
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