Coinbase has bought Utopia Labs in a bid to build out the cryptocurrency exchange’s on-chain payments infrastructure, Coinbase said on Nov. 13.
Utopia Labs’ team will join Base, Coinbase’s layer 2 scaling network, “to help accelerate our onchain payments roadmap within Coinbase Wallet,” Coinbase said in a blog post.
“There’s a natural flywheel here: Base is supporting developers who build onchain apps, those apps attract users onchain, Wallet onboards those users, and in turn more users incentivizes more developers to build onchain,” Coinbase said.
Source: DeFiLlama
Launched in 2023, Coinbase’s Base is now the largest Ethereum (ETH) layer 2 (L2) by total value locked (TVL), according to DeFiLlama.
In October, Base TVL surpassed Arbitrum, the longstanding leader among L2s. Base currently has approximatley $3.15 billion in TVL, versus around $2.9 billion for Arbitrum, DeFiLlama data shows.
On Sept. 12, Coinbase launched its own Bitcoin (BTC) wrapper, cbBTC, on the Base network.
cbBTC has emerged as one of the most popular BTC wrappers, with upwards of $1.3 billion in TVL, according to CoinMarketCap.
Utopia Labs created a platform for individuals and protocols to manage payments in crypto, particularly stablecoins.
Buyouts are increasingly common in Web3, with payments platforms emerging as a sought after acquisiton target.
In October, payment giant Stripe acquired stablecoin platform Bridge in a $1.1 billion deal, in a bid to deliver on an earlier promise to add support for stablecoin payments.
On Nov. 11, Coinbase’s stock surged past $300 for the first time since 2021 amid massive gains for United States crypto stocks after Donald Trump’s victory in the presidential election.
Coinbase’s stock trades at around $290 per share as of Nov. 13, according to data from Google Finance.
“We see Coinbase as a beneficiary of the election results as the firm has been struggling with regulatory pressure from the SEC, with the firm actively fighting the agency in court,” Michale Miller, an equities researcher at Morningstar Inc., said in a Nov. 7 research note.
“With the incoming Donald Trump administration expected to be more favorable to the cryptocurrency industry, the firm’s staking business will face less regulatory pressure,” Miller said.
“Less directly, a more permissive approach to cryptocurrency will likely provide a tailwind to cryptocurrency prices.”
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