rewrite this title What is Base? The Ethereum Layer-2 Network Launched by Coinbase – Decrypt

Leading American crypto exchange Coinbase ventured deeper into the on-chain economy with the launch of its Ethereum layer-2 network Base in 2023.

Originally billed as “a ‘bridge’ for users into the cryptoeconomy,” Base was designed to house Coinbase’s existing on-chain products and provide an open ecosystem for millions of new decentralized apps.

Since its launch, Base has developed into one of the leading Ethereum layer-2 networks, representing a significant chunk of on-chain culture and activity.

Learn everything else you need to know about Base below.

What is Base?

Base is an Ethereum layer-2 network that was created by American crypto exchange Coinbase in 2023. Built on open-source standards and the OP Stack, Base utilizes optimistic rollups, a technology that batches transactions together for processing to help users save on gas fees.

As a result, transacting on Base offers users significantly cheaper and faster transactions compared to those on Ethereum mainnet, all while utilizing the security of the layer-one blockchain.

Why did Coinbase launch Base?

Coinbase launched Base to help solve the critical issue of onboarding new users and developers to crypto, in the hope of one day bringing “billions of users to the cryptoeconomy.”

With that in mind, the company needed to find a way to provide developers and users with safer, cheaper, and faster applications and products. To do so, Base’s layer-2 blockchain was designed to be open source, decentralized, and interoperable—leveraging the transparency of open-source code, acting as a “bridge instead of an island,” to other major crypto ecosystems, and maintaining its commitment to cutting out unnecessary middlemen.

Does Base have a token?

Unlike many other layer-2 networks, Base does not have a native token and instead uses Ethereum as the gas token to facilitate transactions on the network.

While many crypto users have speculated that the chain could eventually get its own token, the exchange has remained adamant that it has no plans to launch a Base token.

“We’re not planning to make any token for Base,” the company’s CEO Brian Armstrong told Decrypt in 2023. In the two years since that statement, the network and its representatives have remained committed to that plan, making no mention of a native token in its most recent strategic update.

Though no native token rewards are provided to those building on the chain, the network does offer builders grants and funding opportunities for their efforts in bringing users and applications to the layer-2 network.

What can you do on Base?

Base is home to dozens of apps and protocols that support on-chain activities across gaming, social, and DeFi, offering users a wide range of potential activities.

DeFi

Home to 492 DeFi protocols according to data from DefiLlama, Base houses more than $2.8 billion in total-value-locked (TVL), or the amount of money held in smart contractson the chain.

The list is headed by the chain’s leading DEX, Aerodrome, which accounts for nearly 25% of the chain’s TVL.

Other traditional DeFi players like Uniswap and AAVE have a large presence on Coinbase’s L2, with smaller protocols like Moonwell and Pendle holding more than $100 million in TVL as well.

Gaming

Base has a robust gaming ecosystem, highlighted by gaming-centric layer-3 network B3, which hosts more than 117 games with over 6 million players. The ecosystem, built by former members of the Base team, has attracted notable Web3 gaming publishers like Parallel Studios and Nifty Island.

Other games like Frenpet, Aavegotchi, and Heroes of Mavia also call Base home.

Consumer applications

Beyond games and DeFi, the layer-2 network is the host to an array of consumer applications ranging from community art to restaurant loyalty programs.

One of the leading examples with ties to Base is decentralized social media protocol Farcaster and its popular Warpcast client, which provide a blockchain-based alternative to popular social media sites like X or Facebook.

Base is also home to token launchpads like Flaunch, restaurant loyalty platform Blackbird, and collectible sticker platform Sofamon among hundreds of others.

How does Base compare to other blockchains?

Coinbase’s scaling network is the largest layer-2 network in the cryptoeconomy today, hosting nearly $700 million more in TVL than Arbitrum, the next largest layer-2 network according to DefiLlama.

But it doesn’t only rank well among layer-2 blockchains in terms of financial performance, when comparing Base to all other blockchains–including layer-1 networks like Solana and Ethereum–it ranks #5 in daily active addresses over the last year according to data from TokenTerminal, with more than 1.2 million active addresses daily.

Additionally, the chain ranks fourth among other layer-2 networks in core developers, trailing Optimism, zkSync Era, and Arbitrum according to data from TokenTerminal.

What’s the future of Base?

Base’s overarching goal has always been to bring billions of consumers on-chain, ultimately expanding the crypto ecosystem beyond its current set of users.

As part of its goals for 2025, the network aims to reach 25 million users, 25,000 developers, and $100 billion in assets on the platform–milestones that it claims are “big, hairy, audacious goals.”

To achieve these goals and beyond, the chain is focused on improving the developer experience by embracing AI agents and beyond, leaning into app distribution to help promote its growing suite of products, and reducing onboarding to less than 60 seconds as it works on its Smart Wallet.