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Cryptocurrency exchange Coinbase has announced the deployment of Base, an Ethereum layer two (L2) scaling network, after developers launched the Base testnet on Thursday. The company said it is incubating Base in Coinbase and that the L2 chain will gradually decentralize over time.
Coinbase joins the competition of Ethereum L2 scaling projects, such as Polygon, Arbitrum, Optimism, Loopring, Starknet and others, by launching an L2 called Base. The company announced the launch of the Base testnet on Thursday and advised the public to stay tuned for the upcoming mainnet launch.
On Twitter, Coinbase tired“Base is an Ethereum L2 that offers a secure, affordable, developer-friendly way for anyone, anywhere, to build decentralized apps. Our goal with Base is to make onchain the next online and embedded 1B+ users in the crypto-economy.”
The cryptocurrency exchange explained that Base will be open source and will leverage Optimism’s OP Stack. Coinbase stated that it is also working with Optimism. “We see this toolkit as an open platform that anyone can contribute to, distribute and extend to help the crypto-economy scale,” Coinbase’s blog post said.
Initially, Coinbase will have more control, but Base’s vision is to stay completely unauthorized overtime. “The base will transition from a Stage 0 to a Stage 1 rollout in 2023 and a Stage 2 rollout in 2024,” the announcement noted. Furthermore, the blog post emphasizes that Coinbase has ‘no plans to issue a new network token.’ While Base will be a separate network, it will be powered by Ethereum and leverage the underlying security of Ethereum.
Coinbase also announced the launch of a Base Ecosystem Fund to support early-stage projects working with Base, as long as they meet the company’s investment criteria. Like many L2 platforms, Base will offer lower fees than the cost of trading on-chain with Ethereum. This week, ETH fees are higher than usual, and L2 protocol Arbitrum, which offers lower fees, surpassed Ethereum’s daily transaction numbers.
“Base offers full EVM equivalence at a fraction of the cost and is committed to advancing the developer platform,” explains the blog post describing L2 Base. Following the Coinbase announcement, the native token of L2 scaling network Optimism, OP, rose 7.4% against the US dollar. Optimism recently revealed its plans to upgrade its network in March.
When Coinbase launched the Base testnet, people on social media complained about a bumpy start. Coinbase Web3 Developer Roberto Bayardo explained that the problem was solved and noted that many people took bro. “We are submitting the contracts for verification now,” Bayardo added.
What are your thoughts on Coinbase’s entry into the Ethereum L2 scaling space with the launch of Base? Let us know what you think about this topic in the comments section below.
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