Since its debut in July 2023, Coinbase’s Layer-2 network, Base, has experienced significant expansion and recognition within the decentralized finance (DeFi) community. Concurrently, Base has emerged as a significant revenue generator for the company.
Coinbase Base Contributes $26 Million In Profits
In the year 2024, the Ethereum Layer-2 solution, Coinbase Base, has experienced significant increase in transaction volumes and fees due to numerous projects being listed on its platform. The high demand for this network has even led to network congestion for Base a few weeks ago.
Despite the significant increase in gas fees on the Ethereum network resulting in increased revenues for Coinbase, according to a CoinShares report, Coinbase is expected to pocket approximately 85% of the profits from the Base layer, while the remaining 15% will be claimed by competitor Optimism.
During the impressive expansion period, Base has significantly reduced the market share of rivals such as Arbitrum and Optimism. According to Dune Analytics’ findings, published by CoinShares, this increase in usage for Base’s Layer-2 network will generate approximately USD 26 million in profit for Coinbase since its launch up until April 15, 2024. This development also adds diversity to Coinbase’s business beyond its traditional brokerage services.
In addition, Coinbase strives to advance its Base platform and keep it cost-effective for users. A notable improvement coming to the Layer-2 Base network is the option to store USDC balances directly on the platform. By implementing this feature, Coinbase aims to streamline the handling and protection of customer funds, resulting in lower transaction fees and quicker settlements.
OKX Pitches A New Competition
On Monday, OKX revealed the public debut of their Ethereum-connected scaling network, X Layer, for use on its mainnet. This development sets OKX apart from other notable blockchain networks, as it offers users swifter and less costly transactions than Ethereum’s mainnet can provide.
The X Layer is built on Polygon CDK, making it one of the early adopters of Polygon’s AggLayer technology.
Introducing X Layer, OKX now goes head-to-head with Coinbase and their Layer-2 solution, Base. Notably differentiating these two offerings is OKX’s implementation of zero-knowledge (ZK) proofs within X Layer.
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2024-04-17 12:42