- The number of daily active addresses on Base has exceeded 2 million, a testament to the protocol’s expanding influence in the DeFi space.
- The introduction of Coinbase Wrapped Bitcoin and the Base Name Service are central to the surge in user engagement on Base.
The cryptocurrency landscape is continually evolving, and the recent spike in daily active addresses on Base, an Ethereum layer-2 protocol developed by Coinbase, is a prime example of this dynamic nature. This significant uptick in activity can primarily be attributed to two pivotal developments: the launch of Coinbase Wrapped Bitcoin (cbBTC) and the unveiling of the Base Name Service (BNS).
Exploring New Horizons with cbBTC
On September 12, Coinbase expanded its offerings on Base and Ethereum by introducing cbBTC, a token that encapsulates Bitcoin in a format compatible with Ethereum’s decentralized applications. This innovation allows Bitcoin holders to engage directly with DeFi platforms without relinquishing their investment in Bitcoin. Each cbBTC token represents a Bitcoin, backed on a 1:1 basis, securely held by Coinbase.
The deployment of cbBTC has not only facilitated a seamless bridge between Bitcoin and DeFi ecosystems but also attracted a considerable user base. Within just a fortnight post-launch, cbBTC has attracted over 3,500 users and sees an average daily settlement of around $472 million worth of Bitcoin on Base. The integration of Bitcoin into this Ethereum layer-2 protocol through cbBTC has been a significant driver of user activity, reflecting in the swelling numbers of daily active addresses.
However, while cbBTC has significantly influenced Base’s metrics, the launch of the Base Name Service has sparked even more enthusiasm across the cryptocurrency community.
Implemented on August 21, the Base Name Service revolutionizes how users interact with blockchain addresses. By allowing the registration of human-readable names for blockchain addresses, akin to the Ethereum Name Service (ENS), BNS simplifies transactions and interactions within the Base ecosystem. This service not only enhances user experience by eliminating the need to handle cumbersome hexadecimal addresses but also fosters a sense of community and belonging among users by enabling a more personalized blockchain presence.
The introduction of Basenames marked a noteworthy milestone, as evidenced by the explosive growth in daily active addresses, doubling from 1.05 million shortly after its launch to over two million within a month. This feature has resonated well within the Base community, significantly contributing to its adoption and the subsequent increase in active addresses.
Base’s Dominance in Layer-2 Networks
Current data from GrowThePie, an analytics platform focused on Ethereum layer-2 networks, indicates that Base now constitutes 70% of active addresses across all layer-2 solutions, with its closest competitor, Arbitrum, accounting for just 9.6%. This dominance underscores Base’s pivotal role in shaping the layer-2 landscape and its growing acceptance among the crypto community.
Despite its burgeoning popularity, cbBTC has not been without its controversies, particularly concerning Coinbase’s transparency regarding its Bitcoin reserves and the user agreement’s implications on reimbursement protocols in adverse events.
