Solana’s Co-Founder Questions Ethereum Utility Without Base Layer 2

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As a seasoned researcher with years of immersion in the cryptocurrency realm, I find it fascinating to witness the rapid growth and evolution of various blockchain ecosystems. The recent surge in Base Layer 2 solutions has undeniably caught my attention, particularly its integration with Coinbase’s user base and the meteoric rise of meme coins like MOG and BRETT.

During a recent conversation, Anatoly Yakovenko, one of Solana’s co-founders, has brought up doubts about Ethereum‘s resilience if it no longer receives support from Base, a Layer 2 solution. This uncertainty arises as we witness the impressive expansion indicated by Base in areas such as user interactions and transaction amounts.

Rapid Growth In Base Layer 2 Solutions

The foundation has experienced a remarkable surge in significant performance indicators like active wallets, transaction volume, and speed, all reaching new record levels. This upward trend is also echoed in its Stablecoin Market Capitalization and Total Value Locked (TVL), both currently at their maximum values.

Integrating Layer 2 within Coinbase’s extensive user community is widely regarded as a key driver behind the increase in its popularity and corresponding growth in relevant metrics.

As a crypto investor, I’ve noticed an increase in activity on Base, which is partly fueled by the growing popularity of meme coins like MOG and BRETT within its ecosystem. These coins have made impressive strides, climbing into the top 100 cryptocurrencies by market cap and seemingly approaching their highest points yet.

Based on DefiLlama’s reports, Aerodrome Finance appears to have significantly boosted Base’s Total Value Locked (TVL). This surge is largely attributed to memecoin trading, with Aerodrome playing a crucial part. The platform has accumulated an impressive $1.36 billion TVL on Base Layer 2, making it a significant factor fueling the rapid growth.

Following the impressive performance by Base Layer 2, Anatoly Yakovenko commented,

“So basically without Base, Ethereum ecosystem would be dead in the water right now.”

Lily Liu, a specialist in on-chain economics, points out a possible concern with how active addresses are clustered in the visualization, stating it might be misleading. In Liu’s view, Solana presents approximately 100 million monthly active addresses, which is more than four times the 22 million reported by Base. This significant disparity suggests that the grouping method used in the visualization may not accurately reflect the activity levels within the ecosystem.

Liu suggests a clearer and more accurate way to display the data is by using one bar graph where the bars representing EVM (Earned Value Management) are shaded differently from those representing non-EVM. This approach will make it easier to distinguish between them and compare accurately.

Furthermore, it’s important to note that while “Base” and “Solana” are often cited as having the most monthly active addresses, this statement fails to consider the significant number of users on the NEAR Protocol, which boasts over 31 million Monthly Active Addresses (MAA). Liu pointed out this discrepancy.

“The headline should therefore read, …Solana and Near as the most active.”

Impact on Ethereum Market Position

Instead, since the Dencun upgrade, Ether has encountered difficulties, including an increase in its supply that’s inflationary and a decrease in its revenues. Meanwhile, Base Layer 2 has seen significant growth, handling a substantial portion of transactions and generating considerable revenue. This development places it as a prominent competitor within Ethereum’s family of Layer 2 solutions.

The divergence in performance between Ethereum and Base highlights the evolving dynamics within the blockchain ecosystem. Layer 2 solutions are becoming ecosystems in their own right with distinct communities and economic activities.

Currently, the value of Ethereum (ETH) stands at approximately $2,678, representing a minor 2% rise over the past week. Moreover, the 24-hour trading volume experienced a significant boost of around 68%, reaching an impressive $19.68 billion, indicating elevated trading activity and growing investor interest.

In my recent analysis, I’ve delved into the distinctions between Solana and Ethereum, two leading players in the blockchain landscape. While Solana boasts impressive technological advantages, it has yet to garner the same level of institutional attention as Ether. This disparity may be attributed to the divergent scaling strategies employed by these platforms.

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2024-10-21 23:34