Base Network, a Coinbase-incubated project on Optimistic Rollup, has seen its TVL and user engagement grow steadily since its launch in August 2023, despite some challenges and volatility.
Base Network is a project that aims to provide a scalable and secure platform for decentralized applications on Optimistic Rollup, a layer-2 solution that improves the performance and cost-efficiency of Ethereum. The project was incubated by Coinbase, one of the leading cryptocurrency exchanges and platforms in the world.
Since its official launch in August 2023, Base Network has shown steady growth in its key metrics, such as Total Value Locked (TVL), transactions, value bridged, and user engagement.
According to L2Beat, a website that tracks the data of layer-2 projects, Base Network’s TVL has reached nearly $735 million as of December 24, 2023, after recording a 4% increase in the last seven days. TVL is a measure of the total amount of assets that are locked in a network or protocol, indicating its popularity and liquidity.
Base Network’s TVL has surged from $592 million at the end of November, showing a strong demand and interest for the project. However, the growth pace has moderated since the initial launch surge, when the TVL spiked from zero to over $500 million in less than a month.
Base Network’s performance and user engagement have also been impressive, reflecting its potential and value proposition. The network’s daily transaction speed (TPS) stands at 3.45, with over 6.97 million transactions executed in the last 30 days. This shows that Base Network can handle a high volume and frequency of transactions, offering a fast and smooth user experience.
Base Network’s total value bridged has also surpassed $600 million, a figure that represents the value of assets that have been transferred across different networks or blockchains using its bridging services. This shows that Base Network can facilitate cross-chain interoperability and compatibility, enabling users to access a wider range of decentralized applications and opportunities.
User engagement on Base Network has also steadily increased, according to DUNE analytics, a platform that provides data and insights on decentralized protocols. Base Network has attracted over 2.5 million cumulative users by November 1 and surpassed 3 million by December 22.
Daily active users reflect a growing community, with a significant jump from launch to 70,000+ users in most of November and December. The daily trading volume of Ethereum on the network has shown a significant increase, rising from a modest 1 ETH to 36,942 ETH in November and then nearly doubling to 79,354 ETH by December.
When compared to its peers, Base Network’s growth is notable. It is competing against giants like Arbitrum One, with a TVL of $8.70 billion, and OP Mainnet, with a TVL of $5.73 billion. These are two of the most popular and established layer-2 projects on Ethereum, offering a variety of decentralized applications and services.
Base Network, on the other hand, is relatively new and has a limited range of DeFi protocols available on it. Some of the protocols that have integrated with Base Network include Uniswap, SushiSwap, Aave, Compound, and Synthetix. Base Network is also working on adding more protocols and features, such as NFTs, stablecoins, and DAOs, to its platform.
The network’s growth is stabilizing, yet the volatility observed in its TVL may stem from its newness, the limited range of DeFi protocols available on it, and initial challenges with scam tokens and rug pulls. Base Network has faced some issues with fraudulent and malicious tokens that have exploited its users and tarnished its reputation.
Some of these tokens include BASE, BASED, and BASED2, which have either disappeared or crashed in value after duping investors.
Base Network has taken measures to prevent and combat these scams, such as implementing a token whitelist, a token verification process, and a token warning system. Base Network has also urged its users to exercise caution and due diligence when interacting with new and unknown tokens on its platform.
