Coinbase Launches cbBTC on Base, Boosting Network Traffic and Surpassing Competitors.
Coinbase expects an increase in network traffic after introducing its new Bitcoin wrapper, cbBTC, on Layer 2 Base. The cryptocurrency exchange has announced that the cbBTC token is now available on Base.
For Bitcoin holders connected to the Layer 2 network, this will open up a wide range of opportunities. As a result of this new growth, the network has recently reached a significant milestone, surpassing both Ethereum and Arbitrum in terms of the number of daily transactions.
Layer 2 Base To Gain More Traction With cbBTC Launch
Following the launch of Coinbase’s wrapped Bitcoin, cbBTC, Base is expected to acquire more popularity compared to its previous state. Coinbase’s announcement indicates that the Ethereum and Layer 2 networks will primarily support the wrapped Bitcoin token.
The cryptocurrency exchange will store Bitcoin, which will act as a 1:1 backing for the ERC20 token known as cbBTC. The release emphasized that Bitcoin holders will have more economic freedom to use their holdings.
We anticipate that the exploration of the decentralized finance (DeFi) landscape on the Layer 2 network by Bitcoin holders will enhance the level of liquidity and participation on Base. They are going to lend their Bitcoin to these DeFi protocols in order to offer liquidity, and they are going to use their holdings to borrow other crypto assets.
There is a possibility that Base will see an increase in the number of Bitcoin holders who are interested in taking advantage of the lending and borrowing capabilities offered by the decentralized protocol Aave, which has already proposed to include cbBTC on its platform.
Additionally, the cbBTC token will be accessible on various other lending platforms, including Compound, Morpho, Moonwell and Spark, among others. Curve and Aerodome, two decentralized exchanges (DEXs), will also support the wrapped token, attracting Bitcoin holders to the Layer 2 Base as they seek to utilize the features these exchanges provide.
A number of additional DeFi applications, including Mellow, Veda, DeBridge, DeFinitive, and Chronicle Labs, will also be able to enable support for the token. As the network continues to gain ground on competitors such as Arbitrum and Optimism, the introduction of cbCBTC on Base provides a significant push to the network in the contest for the layer 2 position.
According to data provided by Dune Analytics, Base has been outpacing Layer 2 networks and Ethereum in terms of weekly transactions since July 22nd. During this time period, the L2 network of Coinbase recorded weekly transactions that exceeded 20 million, while the other networks recorded lesser amounts.
In terms of the number of new users added each week, Layer 2 Base is likewise in the lead, which is an indication that the network is experiencing a higher rate of adoption compared to these other Ethereum scaling grids.
It is noteworthy to note that on September 2, the Coinbase L2 network registered about 3.5 million new users on a weekly basis, while Arbitrum and Optimism saw 227,309 and 125,931 new users, respectively. In addition, Base is significantly ahead of the competition in terms of the number of weekly active users.
