Mainnet Base Successfully Launched, Fully Open to the Public

On August 9, 2023, Coinbase-supported Mainnet Base was officially launched. Base is a Layer-2 blockchain network built on top of Ethereum using Optimism's OP Stack.

Compared to other public chains or Layers, Base was introduced relatively late. However, Coinbase's founder, Brian Armstrong, had plans as early as 2017 and reconsidered building a blockchain in 2018 and 2020 but eventually abandoned those ideas.

It was not until February 2022 that Coinbase officially announced the launch of the Base network and established the Base Ecosystem Fund. In February 2023, the testnet for Base was released, followed by a developer version in July. The mainnet launch in August signifies its opening to the public, allowing users to use the network officially.

Why Did Coinbase Create Base, and What Is Its Purpose?

According to official statements from Base, "We are working towards a grand vision - bringing a billion people onto the chain. To make this happen, we need to bring the next million builders onto the chain and empower them to understand the fundamentals of DApp development, writing, and deploying smart contracts."

Base's tweet announcement, Source: X.

The stated vision does not differentiate between right or wrong; it focuses on the altruistic aspect without mentioning the self-interest. 

In fact, the introduction of the Base network means that Coinbase will transition from a single exchange to a system with a vast ecosystem, attracting more customers (retail and institutional) and partners, thereby generating more revenue. Therefore, the launch of the Base network is expected to benefit Coinbase's stock (symbol: COIN) in the long run.

Will Base Help Coinbase Surpass Binance?

Coinbase and Binance are the two largest cryptocurrency exchanges globally, similar to BTC and ETH, dominating the majority of the market share in the industry. However, they also have a competitive relationship, leading to frequent comparisons.

According to CoinMarketCap statistics, in terms of volume, liquidity, and trading volume, Binance ranks first overall, while Coinbase is in second place. So, can the launch of Base help Coinbase surpass Binance?

Binance, as an exchange (excluding DEX), has a 24-hour spot trading volume of $6.7 billion. Additionally, Binance has a mature and extensive ecosystem, currently having 576 protocols with a Total Value Locked (TVL) of $3 billion (reached a peak of $20 billion).

TVL of Binance Smart Chain, source: DeFiLlama.

Currently, Coinbase's 24-hour spot trading volume is $800 million, far behind Binance. One significant reason for this difference is that Binance expanded aggressively during the previous bull market, but now it is facing regulatory crackdowns from various countries, resulting in limited growth potential. 

On the contrary, Coinbase actively embraces regulations and has high compliance standards, which bodes well for its global expansion in the future. Therefore, surpassing Binance in terms of trading volume is not impossible for Coinbase.

Furthermore, according to data, Base already has over 150 DApps and service providers, including Uniswap, Balancer, AAVE, Chainlink, LayerZero, and Opensea, with higher quality compared to Binance Smart Chain. Additionally, TVL has reached $133 million, making it the fifth-largest Layer-2 blockchain network.

In summary, while Binance's development seems to be on a downhill trajectory, Coinbase is ascending. It is only a matter of time before Coinbase reaches equilibrium and potentially surpasses Binance. Of course, this assumes that Coinbase continues its current development momentum without major issues.