Coinbase (COIN), the prominent U.S. cryptocurrency exchange listed on the stock market, has officially launched its innovative Base blockchain. This development marks the commencement of a groundbreaking era wherein public companies are empowered to operate their own distributed networks. Although Base was previously accessible for developer testing, Coinbase has announced its availability to the general public since 12 p.m. ET on Wednesday.
Coinbase’s Strategic Move
In a strategic maneuver, Coinbase is embarking on a new venture that could substantially reshape its revenue streams. Not only will the company be able to generate fees from the operation of its proprietary blockchain, but it also has the potential to unlock a highly lucrative revenue stream from applications built atop this infrastructure, according to high-ranking executives.
Coinbase’s CEO, Brian Armstrong, articulated his forward-looking vision in a “secret master plan” back in 2016. He foretold that the fourth phase of the company’s evolution would be driven by the proliferation of “decentralized apps” (dapps) intended to connect with a global user base of one billion individuals. This strategic foresight materialized when Coinbase conducted a direct listing of its shares on the Nasdaq stock exchange in April 2021.
The Foundation of Base
Jesse Pollak, Coinbase’s Head of Protocols responsible for overseeing Base, conveyed during an interview that approximately 100 dapps have already been deployed or are poised for launch on the novel network. Pollak emphasized that historically, the realm of possibilities within the cryptocurrency sphere has been confined to speculation. To truly achieve the desired impact, he stated that the trajectory needs to shift from speculative ventures to full integration of cryptocurrency into everyday life.
To celebrate the launch of Base, Coinbase unveiled plans for an “Onchain Summer” promotional campaign in collaboration with corporate partners, including beverage giant Coca-Cola (KO). This initiative aims to showcase the capabilities of the new project to a broader audience.
Base: A Layer 2 Innovation
Technically categorized as a “layer 2” blockchain, Base has been constructed atop the Ethereum blockchain, leveraging the OP Stack software from the widely recognized Optimism layer 2 network. Even before its official public launch, the Base network demonstrated promising traction. L2Beat, a leading cryptocurrency analysis firm, reported that there were already substantial deposits amounting to $139 million locked into apps and protocols on the nascent Base network.
The concept of “total value locked” (TVL), a prevalent metric for evaluating the potential of blockchains and protocols, serves as a testament to the network’s early success. With a TVL figure of $139 million, Base ascends to the position of the fifth-largest layer 2 blockchain in terms of value locked. Leading the pack is Arbitrum One, boasting a staggering $6 billion, trailed by OP Mainnet at $2.9 billion, zkSync Era at $430 million, and dYdX with $336 million.
Conclusion
Coinbase’s launch of the Base blockchain signals a pivotal moment in the evolution of public companies’ engagement with distributed networks. This strategic move not only holds the promise of diversifying Coinbase’s revenue streams through blockchain operation and applications but also signifies the broader integration of cryptocurrency into daily existence. As Base gains momentum, the cryptocurrency landscape stands on the brink of transformation, opening doors to innovative applications and transformative decentralized experiences.