In the fiercely competitive Layer 2 track, Arbitrum and Optimism, which were originally firmly established in Diaoyutai, seem to have encountered unprecedented variables.
According to the L2BEAT data in the figure below, as of July 23, Base’s TVL has climbed to nearly US$7.5 billion, successfully surpassing Optimism’s US$6.87 billion and ranking second, becoming the second largest Layer 2 network after Arbitrum.
Source: Vernacular Blockchain
If we recall that Base itself is a super chain launched based on OP Stack, this drama of "a better one is better than a blue one" seems to be full of a sense of fate.
So why has Base suddenly emerged? What are the connections and secrets behind it with Web3 giants such as Coinbase? What projects in the current Base ecosystem are worth paying attention to?
Base: Layer2 "upstart" based on OP Stack
If we could summarize Base in one sentence, it would be very simple: backed by Coinbase and relying on OP Stack, it makes its fortune from the myth of memes and the traffic of social applications.
Forbes has previously written an article introducing seven powerful people in Coinbase, among which Jesse Pollak, the founder of Base, is prominently listed (the PUNK avatar in the picture below). He joined Coinbase in 2017 and is an out-and-out " veteran".
According to an exclusive interview with Fortune Magazine, he was in charge of Coinbase consumer products in 2021 and came up with the idea of starting a business. In order to retain Jesse Pollak, Coinbase CEO Brian Armstrong (C in the picture below) asked him to try to bring Coinbase to the chain. This also became the initial opportunity for the birth of Base (this may also be the reason why Base naturally has consumer application genes).
Source: FOX
On August 9, 2023, Coinbase officially launched the Base mainnet. Technically, Base relies on Optimism’s open source modular toolkit OP Stack—OP Stack allows developers and project parties to customize the Layer 2 network according to their own needs and scenarios, thereby connecting Join the Ethereum network and share security and resources.
For this reason, Base and Optimism jointly launched a governance and revenue sharing framework:
The greater of 2.5% of the total revenue of the Base sequencer or 15% of the net revenue of the Base on-chain sequencer (Layer2 transaction revenue minus Layer1 data submission costs) will go to the governance system Optimism Collective;
The Optimism Foundation also offers Base the opportunity to earn up to approximately 118 million $OP over the next six years;
Now in less than a year, Base not only stands out in the OP super chain ecosystem, but also surpasses a number of Ethereum Layer 2 networks including Optimism and ranks second on the list. It can be said that it is not unsuccessful.
Therefore, although there is currently no executive title in Coinbase, since the launch of Base is almost one of Coinbase’s most successful products in the field of cryptocurrency in recent years, its influence in Coinbase cannot be underestimated.
Of course, Coinbase, as the only sorter on the Base network, has also made a lot of money. For example, in the first quarter of 2024, users paid $27.4 million in transaction fees to Base (all fees included), of which Coinbase alone received $15.5 million.
According to Coin98 statistics, in addition to Base's rapid growth in TVL, second only to Arbitrum, the number of daily transactions has surpassed Arbitrum, which can be said to be unparalleled. As of July 22, Base's daily transaction number It hit a record high, reaching more than 4 million transactions, almost twice that of the second-place Arbitrum!
Source: Coin98
Such an active on-chain performance is actually not a castle in the air. If we take a closer look at Base, we will find that its consumer genes are very mature, and it has achieved unparalleled competitiveness on the two roads of "memes" and "SocialFi", making it Even without the expectation of issuing tokens, it has still become a super competitive network in the Layer 2 field.
Memes, SocialFi Walking on Two Legs
The first is naturally the layout of the meme field. If we sort out the hot events of Base in the past year, we will find that the myth of memes that create wealth every now and then has become the main driver of the large inflow of funds and users into Base. It can almost be regarded as a clever "marketing strategy" by Base officials.
To put it bluntly, from TYBG, Degen to Brett, etc., almost every once in a while, there will be a "magic disk" on Base that is full of wealth effects, which directly attracts a large number of on-chain traffic to crowd out Base in a short period of time, so that the Ethereum main network Many meme projects on the Internet have even migrated their contracts to Base.
And because various memes with strong wealth-creating effects have broken out of the circle one after another, attracting the attention of the community with increases of hundreds or thousands of times, a large part of the funds pouring into Base are surrounding the meme currency. The layout, to a certain extent, further forms a "self-certifying" logic.
Source: Vernacular Blockchain
In addition to memes becoming one of the constant strategies of its operations, another label of Base is actually “SocialFi”.
The well-known friend.tech brought it the first wave of extremely precious explosive community traffic in September 2023. Through strong binding to Users' Share on friend.tech gives them the right to communicate directly with them, and there is also the possibility of profiting from it. This also makes Base stand out in the social field.
The subsequent Farcaster has firmly established Base as a Layer 2 "social upstart" - not only is its activity leading the way in Web3 and social applications, but it has also completed a large financing of US$150 million. Paradigm, Top VCs like a16z are betting.
Previously in "Following the boss, will there be soup to drink?" "These 7 major projects" are even liked by God V. Have you followed them? "In the article, we also mentioned Vitalik's optimism about it - in September 2023, Vitalik's X account was hacked. Later, Vitalik stated in Farcaster that his X has been uninstalled and joined Farcaster which can control account recovery via Ethereum address.
And judging from the situation at the time of publishing, Vitalik has indeed regarded Farcaster as his main social media base. Currently, Farcaster has become the favorite social platform of Ethereum OG to some extent.
Head project inventory
In addition to technology and popular products, ecological construction is also a necessary condition for Layer 2 to achieve long-term sustainable development.
So to what extent has Layer2’s current ecological landscape developed, and what are the exclusive top projects in each track worth paying attention to? (In addition to friend.tech and Farcaster, multi-chain leading players such as Uniswap and Aave will not be mentioned for the time being)
According to DefiLlama data, the current DeFi TVL on Base is US$1.74 billion, among which the TVL of several (semi-) native DeFi projects dominates, including Aerodrome (US$650 million), Extra Finance (US$106 million), Moonwell (US$83.25 million) ), Morpho Blue ($73.26 million), and others.
Source: Vernacular Blockchain
Aerodrome
The first is of course Aerodrome. As a "MetaDEX", it is also the DApp with the highest TVL on the Base chain. It is also regarded as the core ecological driver of Base - the total lock-in volume exceeds 650 million US dollars, leading the second-ranked Uniswap in a gap. ($282 million), more than double that.
Aerodrome combines elements of various DEXs such as Uniswap V2 and V3, Curve, Convex and Votium. Its unique architecture aligns incentives among different protocol participants, including traders, LPs and investors seeking to bring liquidity to Tokens. protocol and achieves this through its Ve governance model.
Among them, participants must lock AERO Token to collect fees. Locking Token veAERO enables users to direct the protocol's Token emissions to a specific pool, where they will receive 100% of fees and emissions. Due to incentives, voters direct Token emissions to transactions. In the pool with the highest volume, in order to obtain the most rewards, this will undoubtedly create a flywheel effect that attracts LPs (liquidity providers), thereby providing traders with a low slippage trading experience on popular Token pairs.
Extra Finance
Extra Finance is a decentralized borrowing and automatic compound leverage income aggregation protocol based on Optimism. It can provide users with borrowing, up to 3x leverage farming, long/short, neutral strategy, strategy vault and other products.
Like Aerodrome, it also uses ve Token economics. Holders of veEXTRA can unlock some benefits and features, such as annual interest rate rewards, unlock higher leverage for liquidity mining pools, obtain high-utilization token pools, and Be the first to enjoy more upcoming features, benefits, and more.
Other online loan agreements, such as Moonwell and Morpho Blue, are also products with TVL levels of tens of millions of dollars.
Outside of the DeFi field, Base's DApps in consumer fields such as social networking and gaming also deserve special attention.
Warpcast
Warpcast is the Farcaster client of the decentralized social protocol. NFTs on Warpcast have been supported for display on Ethereum, Base and ZORA.
Blackbird
Blackbird is a Web3 platform built specifically for the hospitality industry, focused on creating direct connections with its guests through loyalty and member services.
In October 2022, Blackbird completed an $11 million seed round of financing, co-led by Union Square Ventures, Shine Capital and Multicoin Capital, with participation from Variant, Circle Ventures and IAC.
Other social networks that support Base include Friends With Benefits (FWB), Web3 community activity platform Galxe, etc.
In addition, according to Base official information, Animoca Brands, Game7 DAO, Web3 game solution provider ChainSafe Gaming, blockchain game company Faraway, NFT science fiction card game Parallel, adventure and competitive game Pixelmon, word puzzle game Words3, Yield Guild Games, etc. also For its ecological companies or projects.
summary
In less than a year, it went from 0 to the second place on the Layer 2 list, sucking in $7.5 billion in TVL. This was an achievement achieved without issuing native tokens.
From this perspective, Base, as a leader in the new Layer 2 network, is amazing. It also illustrates the unique advantages of Web3 consumer applications such as social networking. Does that mean who can seize the future of Web3 consumer applications? A hit, who holds the secret to the explosive growth and mass adoption of Web3?
All past is prologue, and Base may be a rare reference sample for those who are committed to making a mark in the field of mass adoption of Web3.
[Disclaimer] There are risks in the market, so investment needs to be cautious. This article does not constitute investment advice, and users should consider whether any opinions, views or conclusions contained in this article are appropriate for their particular circumstances. Invest accordingly and do so at your own risk.
This article is reprinted with permission from: "MarsBit"
Original author: Vernacular Blockchain
