Coinbase’s Base L2 Network Soars in Profitability, Outpacing Rivals

Coinbase's Ethereum Layer-2 network, Base, has emerged as a frontrunner in the competitive L2 space, boasting the highest on-chain profits

Arslan Butt•Wednesday, June 5, 2024•1 min read

Coinbase's Base L2 Network Soars in Profitability, Outpacing Rivals

Coinbase’s Ethereum Layer-2 network, Base, has emerged as a frontrunner in the competitive L2 space, boasting the highest on-chain profits in May according to GrowThePie data.

Base’s Meteoric Rise

Base raked in over $6 million in on-chain profits in May, eclipsing competitors like Blast ($1.5 million) and Optimism ($1.4 million). Base’s total value locked (TVL) has skyrocketed nearly sixfold since March, reaching a record high of $7.6 billion. This surge is attributed to the Dencun upgrade, which implemented EIP-4844 and proto-danksharding, significantly reducing gas fees and attracting more activity.

Coinbase Smart Wallet: A Game Changer

Coinbase’s upcoming Smart Wallet, leveraging account abstraction, aims to simplify on-chain transactions for new users by enabling features like gasless transactions and one-click approvals. This user-friendly approach is expected to attract millions to DeFi and further propel Base adoption.

Coinbase recently acquired Station Labs, a team with expertise in building on-chain developer tools, to further enhance Base’s functionality.

The L2 Landscape

While Base dominates, Blast, a rising L2 network from Blur (NFT marketplace), is gaining recognition for its unique native yield offerings for ETH and stablecoins. Despite Base’s impressive growth, industry leader Arbitrum maintains its TVL dominance at $19.1 billion. However, Base’s rapid expansion and the Smart Wallet’s launch could potentially narrow this gap.

The combined efforts of Base, Station Labs, and the broader L2 ecosystem are focused on providing user-friendly tools to simplify on-chain transactions and onboard new users to DeFi.

Check out our free forex signals
Follow the top economic events on FX Leaders economic calendar
Trade better, discover more Forex Trading Strategies
Open a FREE Trading Account

ABOUT THE AUTHOR See More

Arslan Butt

Lead Markets Analyst – Multi-Asset (FX, Commodities, Crypto)

Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics. His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker. His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.