Coinbase announced the testnet launch of its new native Ethereum Layer 2 network, Base. The solution offers a secure, low-cost, developer-friendly way for users to build dApps. Base is built on the MIT-licensed OP Stack and is powered by Optimism.
Right after the launch, the crypto community was quick to opine on why Coinbase’s solution is a game changer. In one such thread on Twitter, Ryan Sean Adams, the founder of Bankless, chalked out ten reasons why Base’s launch is a “big deal.”
According to Adams, Coinbase choosing Ethereum to build its L2 network on is a “massive vote of confidence.” He went on to highlight how this sets precedent for other banks, crypto, and fintech companies. He added,
“Eventually the world will use Ethereum as a settlement and property rights system.”
In fact, a few others in the space also opine similarly. Recently, Polygon’s Co-Founder Sandeep Nailwal appeared in an interview with Crypto Banter. According to him, there wouldn’t be a “multi-Layer 2 environment.” Instead, there will be only “one single” layer in Layer 1—Ethereum—on top of which other Layer 2 user activities will take place, he said.
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Additionally, traditional media companies have already been flocking to the Ethereum network. As reported in early February, Visa is already testing how to accept payments and payouts on Ethereum via the stablecoin USDC. Cuy Sheffield, Vice President and Head of Crypto at Visa, highlighted that the transactions were “large value settlement payments.”
In fact, the company started exploring options to allow auto payments via Ethereum wallets before that itself.
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Base’s launch: A ‘win’ from all perspectives?
Coinbase clarified yesterday that it has “no plans” to issue a new network token. Nevertheless, it remains committed to “full decentralization” eventually. According to the Bankless founder,
“This is the maximally decentralized way for an exchange to launch a chain, no token, no walled garden, all open source. This is good for crypto values. More DeFi, less CeFi.”
Coinbase has over 110 million verified users on its platform. According to Adams, even if the exchange manages to onboard 1/5th of them and get them to use its L2, it would boost the total number of crypto-native users. Coinbase specifically emphasized that it intends to make “on-chain” the next “online” and get over a billion users into the ecosystem.
Adams highlighted how Base’s launch tackles regulators’ concerns about retail protection. Elaborating on how, he tweeted,
“The answer is regulation by code, a trustless money system built on transparent, open, DeFi protocols.”
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Furthermore, Adams pointed out that Base’s launch would rub off positively on Ethereum’s “blockspace demand” and incentivize Coinbase to refine infrastructure products. He added that this would “speed our progress.”
Moving on, the executive highlighted how Base’s launch is a positive move from the regulatory and L2 infrastructure perspectives. Elaborating on the same, he tweeted:
Concluding by emphasizing how this is a “win” for technology, Adams tweeted,
“This shows that credibly neutral technologies, the ones that no one can control or corrupt, these are the technologies that win.”
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